China’s economy has shown surprising resilience in the first quarter, with a 5.3% annual growth rate compared to analysts’ forecasts of 4.8%. This growth can be attributed to the government’s policies and increased demand.
The Chinese economy has been struggling to recover from the impact of COVID-19, with a slowdown in demand and a property crisis affecting growth. However, industrial output increased by 6.1% in the first quarter compared to the previous year, while retail sales grew by 4.7%. Fixed investment for the same period also saw a 4.5% increase. These positive results were driven by strong manufacturing performance, increased household spending during the Lunar New Year holidays, and supportive policies for investments.
Despite this positive growth, there are signs of weakness emerging in March, with uncertainties in external demand and a decline in import and export figures. Factors like inventory adjustments, normalization of post-holiday spending, and cautious stimulus measures could impact growth in the second quarter. However, policymakers have introduced various fiscal and monetary measures aimed at boosting the economy further. The government has set a GDP growth target of 5% for 2021, showing its commitment to supporting economic recovery and growth in the long term.
