Foreign banks express optimism over China's economic growth

Several chief China economists of foreign banks have expressed their confidence in the Chinese economy which posted a robust 5.2% year-on-year growth in 2023, recent interviews with Xinhua revealed.

China's National Bureau of Statistics (NBS) on Wednesday disclosed the full-year performance of its major economic indicators for 2023, with the GDP hitting a record 126.06tn yuan ($17.7tn).

"China remains a very important driver of global growth," said Xiong Yi, chief China economist at Deutsche Bank. China's GDP growth rate is very impressive, well above that of global average and the average of developing countries, said Xiong, adding that the International Monetary Fund forecasted that the global economy in 2023 grew by 3%, with an average growth rate of 1.5% for developed economies and 4% for developing countries.

Consumption, a mainstay of the Chinese economy, contributed 82.5% of the GDP growth in 2023, according to the NBS. "A major reason behind the steady expansion of consumption is that China's per capita disposable income has been growing," said Xiong.

After deducting price factors, China's per capita disposable income rose 6.1% from the previous year. Notably, the index for China's rural residents grew at a faster pace than that of the city dwellers in the period, suggesting a narrowing gap between the two groups. Wang Tao, chief China economist and head of

Asia Economic Research at UBS, stressed that growth of export volume picked up further in December last year, leading to a notable rebound in the fourth quarter from the third quarter.

"We forecast exports to improve modestly on the upswing of the global tech cycle," said Wang.

According to the General Administration of Customs, despite the global headwinds in trade, China's exports have reached a new high on a high base and retained its global share.

In recent years, China's manufacturing industry has been moving up the value chain, with the added value of China's manufacturing industry accounting for around 30% of the global total.

"The competitiveness of China's manufacturing industry in the global market continues to increase," said Xiong, stressing that "exports of the three types of new star products in 2023, namely new energy vehicle, lithium battery and solar cell, exceeded one trillion yuan by value for the first time, adding to the upward momentum in foreign trade."

Lu Ting, chief China economist at Nomura, noted that fixed-asset investment growth quickened to 4 percent year-on-year in December from 2.9% in November, above market expectations.

Experts believe that more positive factors are accumulating for China's growth prospect.

"In the coming months, we expect property activities and property market to stabilize, helping to underpin household confidence. That should support continued POST-COVID consumption recovery along with the economy and labor market," said Wang Tao.

The Chinese government has proposed that proactive fiscal policies should be appropriately strengthened, and their effectiveness improved.