China’s economy is projected to grow at a rate of 5 percent this year, which is an upgrade from the earlier projection of 4.6 percent expansion. The International Monetary Fund (IMF) expects slower growth in the coming years, with GDP targets for 2024 and 2025 revised up by 0.4 percentage points. However, the IMF warns that growth in China may slow to 3.3 percent by 2029 due to factors such as an ageing population and slower productivity expansion.
In recent years, China’s economic growth has remained resilient at around 6 percent, thanks to strong first-quarter GDP data and recent policy measures. In the first quarter of this year, China’s economy grew by 5.3 percent year-on-year, surpassing analysts’ expectations. This growth has been attributed to domestic consumption and exports, which have remained strong despite concerns about a property sector crisis.
Despite some positive economic indicators in April, such as factory output and trade numbers, there are lingering concerns about the economic recovery. Retail sales grew at the slowest pace since December 2022, and new home prices experienced a significant decline. The IMF has welcomed recent steps taken by policymakers to stabilize the property sector and has urged for continuous efforts to steer the sector towards sustainability.
However, there are challenges ahead in terms of sustaining this growth, particularly in the context of a fragile property sector and soft domestic consumption. It will be crucial for policymakers to address these challenges to ensure a more stable and sustainable economic path for China in the long run.
The IMF stated that China’s economic growth is projected to remain resilient at around 6 percent in 2024 but slow down slightly to around 5 percent in
