(Economic Watch) Two "exceeded expectations" in China's third quarterly report

Beijing, 10 Oct (ZXS) -- Two "Exceeding Expectations" in China's Third Quarterly Report

China News Agency reporter Pang Wuji

The third quarterly report of China's economy in 2023 was announced on the 18th. Observers pointed out that two economic indicators in the three quarterly reports released on the same day exceeded expectations, and positive changes occurred in many fields and indicators, and China's economy showed a sustained recovery momentum.

The first is the economic growth rate. Data released by China's National Bureau of Statistics showed that China's gross domestic product (GDP) grew 4.9% year-on-year in the third quarter, higher than the consensus expectations of market institutions. Sheng Laiyun, deputy director of the National Bureau of Statistics, said that although due to the increase in the comparative base last year, compared with the second quarter of this year, the year-on-year growth rate of GDP fell back in the third quarter compared with the second quarter, but if the base factor is deducted, the two-year average growth rate in the third quarter is 4.4%, which is 1.1 percentage points faster than the second quarter.

While the year-on-year growth rate of economic growth in the third quarter exceeded expectations, the month-on-month growth rate was also better than expected. Pang Ming, chief economist and director of the research department of JLL Greater China, told China News Agency that the month-on-month GDP growth rate in the third quarter accelerated to 1.3%, which was also better than market expectations, indicating that the recovery of the economy is generally establishing a pattern and accelerating the trend of efficiency. Sheng Laiyun also pointed out that whether it is the year-on-year growth rate of China's economy in the third quarter or the cumulative growth rate of the first three quarters, it is among the best in the international major economies.

Economic growth stabilized and rebounded in the first three quarters, laying a solid foundation for achieving the annual development goals. Yao Jingyuan, a special researcher of the State Council Counsellors' Office and former chief economist of the National Bureau of Statistics, said at the State Council Forum held by the China News Agency on the same day that China's economy has rebounded steadily and is positive, and there should be no problem in achieving the expected target of about 5 percent this year. Shenglaiyun also pointed out that as long as the growth rate in the fourth quarter is more than 4.4%, it can guarantee the completion of the expected target of about 5% for the whole year, and is very confident in achieving this goal.

Another better-than-expected area is in the field of foreign trade. Data previously released by the General Administration of Customs showed that the total value of China's imports and exports in the first three quarters fell by 0.2% year-on-year, basically the same as the same period last year. Sheng Laiyun frankly said that this year's world economic fluctuations are down, external demand is generally contracted, coupled with the previous years of foreign trade has maintained a high growth, the base is higher, originally worried that this year's foreign trade decline more, but from the actual operation point of view, the third quarter of the decline significantly narrowed, better than expected.

Zhou Jingtong, vice president of the Bank of China Research Institute, also believes that although imports and exports in the first three quarters fell slightly year-on-year, considering the global economic downturn this year, in horizontal comparison, China's exports are significantly better than export-oriented countries such as South Korea and Vietnam. This aspect is related to the relatively complete structure of China's export products and the overall comparative advantages. There are many types of Chinese export commodities, including traditional industries, equipment manufacturing and high-tech industries. On the other hand, it is also related to the rapid growth of China's exports to new export destinations such as the "Belt and Road" countries and ASEAN. Looking forward to the future market, Zhou Jingtong believes that China's imports and exports may turn negative to positive in the fourth quarter.

In addition, in recent months, China's industrial, consumption and other indicators have shown an overall recovery momentum, especially consumption has played the role of "ballast stone". Official data show that consumption contributed 83.2% to economic growth in the first three quarters of this year, and service consumption is an important part of it, and the growth rate is relatively fast. Guo Liyan, director of the situation office of the decision-making and consulting department of the China Academy of Macroeconomic Research, said that since the data on retail sales of services began to be released in July, the data has remained at a high level of about 7% in the past three months.

Guo Liyan said that the summer season travel in August and the "double festival" holiday effect of the Mid-Autumn Festival and the National Day boosted consumption in the third quarter. Service consumption has driven the recovery of consumption of other related goods, which can be said to be a clear feature of economic operation in the third quarter.

Consumption is ultimately supported by income. On the one hand, since the beginning of this year, China's employment situation has generally improved, and in September, the national urban survey unemployment rate fell to 9.5%; On the other hand, residents' income in the first three quarters increased by 0.5% in real terms, "outperforming" the GDP of the quarter, laying the foundation for sustainable recovery and growth of consumption in the future. Guo Liyan said that it is expected that the growth rate of total retail sales of consumer goods throughout the year is expected to be about 9%.

Looking forward to the fourth quarter, many experts did not shy away from saying that there are still many pressures and challenges in China's economic operation. Yao Jingyuan pointed out that the follow-up needs to play a good combination of macro policies, fiscal policy, monetary policy, social policy, industrial policy, etc. need to coordinate with each other to form a joint force to promote demand expansion, risk resolution, and expected stability. (End)