After touching a marked low during this year's
current quarter, China's economy is likely to rebound in 2023, Xu Wei, deputy
director of the department of macroeconomic research under the State Council's
Development Research Center, predicted at Mysteel's annual conference in
Shanghai on December 30.
from multiple fronts, China's economic recovery was unstable this year,"
Xu commented. "And the changes in the COVID prevention and containment
measures also brought challenges to economic development," he noted.
According to Xu, since
October this year, both population movement and transport of goods throughout
China were less active compared with the same period in previous years while at
the same time, the domestic supply-demand environment was dull.
In early November,
capacity utilization among the more than 20,000 industrial parks in China was
around 65%, lower than the normal level of 70-80%, Xu noted. On the demand
side, the expansion of the manufacturing industry was modest, while the real
estate market failed to receive any strong boost from government incentive
policies, he added.
Nevertheless, due to
its inherent resilience Xu expects that China's economy will generally rebound
next year from the low base in 2022.
"In the past
three years, the domestic economy was suffered repeated hits - the pandemic,
the tussle between US and China, and disruptions to global supply chains - and
yet it still registered annual growth of around 4.5% on average," Xu
pointed out. "From the low base of 2022, it is possible that the country's
economic growth rate will reach 5% in 2023," he predicted.
"When the impact
of the pandemic subsides, people's consumption and investment may contribute to
the steady rise of the economy following the rebound," he added.
Moreover, the increase
in Chinese consumer prices is likely to remain gentle in 2023, which means that
the country's economy will not face too much pressure from inflation, Xu noted.
As such, there is more space for the government to implement stimulus policies.
Xu also emphasized
that the government's reinforcement of macroeconomic regulation is necessary
for economic growth and is crucial for building a new industrial development
"China needs to
expand domestic demand, optimize investment structure, ensure the safety of key
industry supply chains, and form a high-quality circulation mechanism (for
commodities and natural resources)," he concluded.