Growth in China’s economy slowed in the fourth quarter of 2022, with GDP growing by 2.9% in October-December from a year earlier, according to data from the National Bureau of Statistics (NBS).
While slower than the third-quarter’s 3.9% growth, the rate still exceeded second-quarter expansion of 0.4% and market expectations of a 1.8% gain.
The Chinese government recently lifted the strict anti-Covid measures that had restrained economic activity in 2022, but the relaxation has led to a sharp rise in Covid cases that economists say might hamper short-term growth.
For 2022, GDP expanded 3.0%, missing the official target of “around 5.5%” and down from the 8.4% growth experienced in 2021.
Growth is likely to rebound to 4.9% in 2023, as Chinese leaders move to tackle some key drags on growth – the ‘zero-Covid’ policy and a sharp property sector downturn, according to a Reuters poll of economists, with most those polled expecting growth to pick up from the second quarter.
Kang Yi, head of the NBS, said economic performance “remained overall stable last year despite the challenges of intensified geopolitical tensions, rising global downside risks and repeated COVID-19 outbreaks”, pointing to the resilience and potential of China’s economy.
“Looking into 2023, China’s economy is bound to see an overall improvement,” Kang Yi said, adding that economic activity is gradually normalizing as the country enters a new phase of Covid response, with domestic flights having recovered to more than 80% of the level seen in 2019.
Kang Yong, chief economist at KPMG China, said he expects the country’s economic growth to grow to about 5.2% in 2023, saying a rebound in consumer spending was likely as the country opens up.
At the national level, Kang Yong said it was “sensible to set this year’s GDP growth target at above 5% year-on-year, which will be not only attainable but necessary for the country to reach the goal of achieving the per capita GDP of a midlevel developed country by 2035”.
More efforts are therefore still needed to consolidate the foundation of China’s economic growth, NBS head Kang YI said, given the stagflation risk facing the world economy and the lingering pressures facing the domestic job market.
China Construction Bank app aims to make borrowing easier
The state-owned China Construction Bank has upgraded its mobile lending app specifically with small businesses in mind, making it a comprehensive service platform connecting government agencies and service providers.
The Beijing-based commercial lender’s upgraded app, called ‘Hui Dong N’, will make greater contributions to the growth of micro, small and medium-sized enterprises while promoting high-quality economic development, said Cui Yong, executive vice-president of the bank.
Launched in September 2018, the CCB app targeting micro and small enterprises, self-employed people and farmers, has 8.5 million businesses users. Loans issued via the app were worth nearly 5 trillion yuan ($710 billion), and the current balance of loans is 1.19 trillion yuan, said Guo Chaojing, leader of the app update project.
The latest version of the app has new lending service functions, such as allowing existing borrowers to get a higher credit limit and automatically recommending loan products to clients based on a more precise understanding of their needs.
Apart from lending services, CCB will provide income-expenditure analysis and customized wealth management services to small businesses. It is linked to government agencies and other service providers to create an ecosystem to meet the needs of small businesses in many areas, including express delivery, financial management and legal consultation, Guo said.
According to Yin Youping, deputy director of the financial consumer protection bureau at the People’s Bank of China, the app has been upgraded from a financing platform to a comprehensive service platform.
“By building a platform-based ecosystem through open and shared development and win-win cooperation, CCB will allow more participants to better serve small businesses and enable such businesses to sustain long-term growth. The updated app provides new ideas for the development of digital financial inclusion,” Yin said.