China’s economic growth in 2022 slumped to one of its worst levels in nearly half a century as the fourth quarter was hit hard by strict COVID curbs and a property market slump, raising pressure on policymakers to unveil more stimulus this year.
Gross domestic product (GDP) grew 2.9% in October-December from a year earlier, data from the National Bureau of Statistics (NBS) showed on Tuesday, slower than the third quarter’s 3.9% pace.
The rate still exceeded the second quarter’s 0.4% expansion and market expectations of a 1.8% gain.
Beijing’s sudden relaxation of stringent anti-virus measures has boosted expectations of an economic revival this year; however, it has also led to a sharp rise in COVID cases that economists say might hamper near-term growth.
A property slump and weak global demand also mean a rebound in growth will be heavily reliant on shell-shocked consumers.
“China’s 2023 will be bumpy; not only will it have to navigate the threat of new COVID-19 waves, but the country’s worsening residential property market and weak global demand for its exports will be significant brakes,” Harry Murphy Cruise, an economist at Moody’s Analytics, said in a note.
For 2022, GDP expanded by 3.0%, badly missing the official target of “around 5.5%” and breaking sharply from 8.4% growth in 2021. Excluding the 2.2% expansion after the initial COVID hit in 2020, it’s the worst showing since 1976 – the final year of the decade-long Cultural Revolution that wrecked the economy.