Posted on 27 Feb 2023
China's economy is strongly placed to recover momentum this year with the country recalibrating its COVID policy and reopening to the world, Gao Min, an economist with the Chinese think-tank Chingshin Insight, told delegates attending the National Steel Scrap Conference in Chengdu in Southwest China's Sichuan on February 23.
"Over the past year, we've lived through some of our darkest days. But those days are behind us now, and everything will go back on track this year," Gao said.
The country may still face pressures from shrinking demand, rising supply and weakening market sentiment this year, Gao warned, together with other uncertainties including the global fight against inflation, renewed COVID outbreaks and geopolitical tensions. Nevertheless, the Chinese economy will remain resilient and vigorous, Gao believed.
His assumption is based on the fact that at the Central Economic Work Conference in Beijing in mid-December last year, central government officials made economic stability a top priority to safeguard growth, employment and prices, with special emphasis placed on boosting domestic demand to fuel a stronger rebound.
Moreover, to resolve the property crisis and to reduce the risk of spillover, the government has taken sweeping measures, Gao observed. These include strengthening temporary mechanisms to protect presale homebuyers from the risk of non-delivery, by restructuring troubled developers, and by meeting the reasonable financing demand of the sector, among others.
"So we have every reason to believe that domestic consumption will increase markedly and the real estate sector will slowly recover this year," Gao said.
But he also noted that the property market's overall weakness may remain throughout 2023 as both investment and consumption in the sector will still need time to stabilize.
On the other hand, investment in China's infrastructure sector is expected to maintain its momentum, as the sector will remain in the driver's seat as an important vehicle to boost domestic demand and to promote economic growth, Gao said.
Source:Mysteel Global
