China: Q2 Economy Grew Slower Than Expected
China's economy grew more slowly than expected in the second quarter as youth unemployment hit a record high of 21.3%. Official data released Monday says that gross domestic product (GDP) expanded by 6.3% year-on-year, up 0.8% during the Q2 compared with the previous quarter.
Facts
- China's economy grew more slowly than expected in the second quarter as youth unemployment hit a record high of 21.3%. Official data released Monday says that gross domestic product (GDP) expanded by 6.3% year-on-year, up 0.8% during the Q2 compared with the previous quarter.1
- China's GDP figure contrasts with 2022 — when Beijing enacted "zero COVID" policies and brought economic activity to a standstill. Economists predicted that China's economy would grow by greater than 7% this year.2
- The disappointing GDP notwithstanding, China's statistics bureau said its economy "showed good momentum of recovery in the first half year." The PRC's retail sales grew 3.1% in June from a year ago — a plummet from May's 12.7% growth.3
- The government's growth target is 5%, following a 3% expansion last year. The global recession has caused some economists to raise the risk of China missing its target for 2023, thus pressuring the government to launch a stimulus package which Beijing some policymakers have been cautious of.4
- However. China's top economic policymakers are expected to roll out stimulus steps — including funding major infrastructure projects, more aid for consumers and private firms, and changes to property regulations. Expectations are high for the Politburo meeting later this month when top leaders could unveil the next steps.5
Sources: 1CNBC, 2Al Jazeera, 3Business Insider, 4Trading Economics, and 5Daily Sabah.
Narratives
- Narrative A, as provided by XINHUA. Despite external challenges, China's economy has performed remarkably well this year. It has grown significantly faster than that of the world's major developed economies, demonstrating the strong resilience of its economic development. China has shaken off the impact of the epidemic and has returned to normal growth. China's economy remains strong as indicated by numerous economic indicators.
- Narrative B, as provided by Daily Sabah. China's economy grew at a much slower pace than forecast in Q2, and its recovery from its recent lockdown is slower than anticipated. The world is looking at what measures of stimuli China's politburo will take later this month to address the many problems ahead. The record youth jobless rate and down-trending property sector are real causes for concern.
Predictions
