2023-07-17 02:54:12
Chine
Misleading rebound of Chinese growth in the second quarter
China is aiming for around 5% growth this year, a goal that may be difficult to achieve, however, according to Premier Li Qiang.
Posted17 July 2023, 04:54
The unemployment rate for young Chinese aged 16 to 24 reached a new record in June, at 21.3%. (Pretext image)
AFP
China saw its growth accelerate in the second quarter, according to official figures published on Monday, which however mask the difficulties of the second world economy, faced with a difficult economic situation and record youth unemployment.
In the second quarter, gross domestic product (GDP) jumped year on year by 6.3%, according to the National Bureau of Statistics (BNS). This rate of growth, which would make many people envious in most major economies, is however far below the expectations of analysts polled by AFP (7.1%).
And this figure is misleading because the comparison is always made with the same period a year earlier: in 2022, growth in the second quarter had been modest (+0.4%), largely weighed down by the confinement of the economic capital. Shanghai.
Shortness of breath
From one quarter to another, on the other hand, a more realistic basis for comparison, the growth of the Asian giant has slowed to 0.8%, following an increase of 2.2% over the January-March period. The post-Covid recovery at the start of the year, which is still slow to materialize in certain sectors, has tended to run out of steam in recent months.
“In the second quarter, this momentum lost steam due to a drop in global demand for (Chinese) goods which weighed on exports, the weakness of the real estate sector and generally insufficient domestic demand”, indicates Economist Erin Xin of HSBC bank told AFP.
The Chinese economy faces “a complex and difficult international situation, and difficult tasks for reform, development and ensuring stability” in China, admitted to the press a spokesman for the BNS, Fu Linghui.
Record youth unemployment
The unemployment rate for young Chinese aged 16 to 24 reached a new record in June, at 21.3%. Retail sales, the main indicator of household consumption, fell further in June, according to official figures released Monday by the National Bureau of Statistics (BNS).
The indicator is certainly up over one year (+3.1%) but this rate is much lower than that of May (12.7%) and in line with the expectations of analysts polled by Bloomberg (3.1%). “Consumption remains a driver of the recovery. In certain sectors, in particular services, the recovery has been particularly strong”, in particular for tourism, indicates to AFP the economist Erin Xin, of the bank HSBC, which notes expenses “weaker” than before the pandemic. .
Rare improvement among these indicators: industrial production rose 4.4% in June, once morest 3.5% a month earlier. Analysts were counting on a more moderate pace (2.5%) of this indicator which gives an overview of activity in the industrial sector.
Questionable
In the second quarter, the GDP figure (+6.3%) benefits from the comparison effect compared to last year: in 2022, growth over the same quarter had been modest (+0.4%), largely weighed down by the confinement of the economic capital Shanghai. On the other hand, from one quarter to another, a more realistic basis for comparison, the growth of the Asian giant is up 0.8%, following 2.2% over the January-March period.
The official figure for growth in China, eminently political and subject to caution, is nevertheless still closely scrutinized given the weight of the second largest economy in the world. China is aiming for around 5% growth this year, a target that might be difficult to achieve, however, Chinese Premier Li Qiang has warned.
(AFP)Show comments
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