Economists say China’s first-half GDP likely to top 5% target

Financial policy: People walk through the central business district in Beijing. China has announced a series of measures to boost demand, including the issuance of US$138bil worth of ultra-long-term special treasury bonds. — AFP

BEIJING: China’s economy will likely expand by over 5% in the first half of this year amid strong policy stimulus, robust industrial production and stable external demand, providing a solid base for achieving its annual growth target of around 5%, economists say.

Looking into the second half of the year, they said the economy is on track for stable growth thanks to strong manufacturing performance, resilience in exports and stepped-up macroeconomic policy support.

Meanwhile, they cautioned of the pressures from lacklustre domestic demand and mounting external uncertainties, saying stronger financial stimulus measures will be key to tackling the issues the economy faces and that more efforts should be made to boost private investment, spur consumption and further stabilise the property market.

“China’s economy has made a good start at the beginning of the year, and the economy has continued the recovery trend in the first half of 2024,” said Wen Bin, chief economist at China Minsheng Bank.

“China’s economy will likely grow by around 5.2% in the first half, followed by a 4.9% growth in the third quarter and a 5.1% increase in the fourth quarter.”

The market eagerly awaits the release of key economic indicators by the National Bureau of Statistics next Tuesday.

As the broader economy is still facing pressures from still-weak domestic demand as well as a more complicated and grim external environment, Wen said he expected to see more government measures to accelerate infrastructure construction, drive large-scale equipment renewal and digest existing housing inventories.

“It is advisable to step up financial policy support, deepen reforms and expand opening-up, which will help strengthen internal driving forces and significantly boost market confidence,” he said.

On the monetary front, as the US Federal Reserve is tipped to start interest rate cuts soon, he said any such cuts would create more room for the People’s Bank of China to ease monetary policy. — China Daily/ANN