Staff members work at a workshop of a wind power equipment industrial base in Huimin County, east China's Shandong Province, June 7, 2022. In the first three quarters, China's GDP increased 3 percent year on year, 0.5 percentage points faster than that in the first half of 2022, according to the National Bureau of Statistics (NBS) data. (Xinhua/Guo Xulei)
BEIJING, Jan. 6 (Xinhua) -- Bidding farewell to 2022, China's economy is expected to recover at a faster pace in the year of 2023 when both policy boosts and domestic demand are likely to rev up the recovery.
-- Economic growth likely to rebound
In 2022, China's macro-economy weathered challenges with stability in general. By gross domestic product (GDP), the country may see the macro-economic development gauge exceed 120 trillion yuan in 2022, which stands for hard-won achievements especially on basis of the high base data in 2020 and 2021.
In the past two years, China's GDP grew to exceed 100 trillion yuan and reached 114.9 trillion yuan in 2021.
At the annual conference of China Center for International Economic Exchanges (CCIEE) held recently, Han Wenxiu, executive deputy director of the office of the Central Committee for Financial and Economic Affairs noted that optimized epidemic prevention and control measures would affect the economic running in a way similar to the "J-curve effect".
After the short-term disturbance, the optimized epidemic prevention and control measures meant significant boosts to the economy in the whole year, held Han, saying that China's social production and life are likely to pick up pace with greater economic vitality in 2023.
Many experts also believed that China's economy would grow at a faster pace in 2023. Wen Bin, chief economist with China Minsheng Banking Co., Ltd. said that China's economy might grow by about 5.5 percent in 2023. Huang Wentao, chief economist with China Securities expected China's 2023 GDP to edge up 5.1 percent year-on-year amid relatively notable seasonal volatility.
-- Policy boosts to underpin recovery
As many industry analysts forecast, the existing policies and foreseeable new policies in 2023 are likely to expedite the economic rebounding.
China would pour more efforts to coordinate and align the cross-year policies to unlock the potential of measures rolled out since the second half of 2022 such as policy and development bank financial vehicles and up-sized mid- and long-term lending for manufacturing sector in 2023, Zhao Chenxin, deputy head with the National Development and Reform Commission (NDRC) told Shanghai Securities News recently.
At a time when global post-epidemic recovery lacks momentum and overseas demand shrinks, there is still need for China's monetary policy to function to maintain the pro-loose liquidity environment, according to Huang Wentao. In his eyes, there might be one required reserve ratio (RRR) cut and one policy rate cut this year.
Chinese policy makers also vowed to further leverage policies to better support the economic recovery. Liu Kun, Minister of Finance of China required at an online national fiscal work meeting more direct and more effective functioning of the proactive fiscal policies, further enhancing the pertinence and effectiveness of fiscal policies, optimizing policies for easing difficulties of businesses to spur vitality of market entities of varied types, and thoroughly implementing the employment-first policies to vigorously foster confidence of market entities.
-- Domestic demand to serve as a stronger engine
In 2023, domestic demand that includes demand to be brought by both investment and consumption is anticipated to play a bigger role in vitalizing the economy.
Liu Yuanchun, principal of Shanghai University of Finance and Economics thought that the focus of macro economic policies targeting expanding the domestic demand would change from the traditionally investment-led mode to those driven by both consumption and investment.
Currently, insufficient demand is the outstanding issue that China's economy faces and great efforts shall be made to spur domestic demand, according to Wang Yiming, vice chairman of the CCIEE. Wang suggested prioritizing resumption and expansion of consumption, increasing urban and rural resident income via multiple channels, supporting residents' housing demand and demand for improved housing, etc. to actively boost consumption.
Under such circumstances, many industry experts are optimistic about the consumption rebounding in 2023.
As Wen Bin reckoned, consumption in China was likely to rebound notably in 2023 thanks to the consumption scenario resumption, income growth recovery, roll-out of consumption-boosting policies and low base data effect. For the whole year of 2023, consumption may increase by 9.0 percent year on year. (Edited by Duan Jing with Xinhua Silk Road, duanjing@xinhua.org)
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