The quarterly growth and some of the December indicators such as retail sales beat market expectations, but analysts noted the overall economic impulse across China remained weak and highlighted the challenges facing Beijing after it abruptly lifted its zero-Covid policy last month.
Beijing’s sudden relaxation of stringent anti-virus measures has boosted expectations of an economic revival this year, but it has also led to a sharp rise in Covid cases that economists say might hamper near-term growth. “China’s 2023 will be bumpy; not only will it have to navigate the threat of new Covid-19 waves but the country’s worsening residential property market and weak global demand for its exports will be significant brakes,” Harry Murphy Cruise, economist at Moody’s Analytics, said in a note.
Excluding the 2.2% expansion after the initial Covid hit in 2020, it’s the worst showing since 1976 – the final year of the decade-long Cultural Revolution that wrecked the economy.