2023 China Economic Half Year Report: High Content of Economic Growth in the First Half of the Year, Recovery of Economic Performance, and Positive Consumption | Growth | Economy
On July 17th, the 2023 China Economic Half Year Report was released. In the first half of this year, the gross domestic product (GDP) increased by 5.5% compared to the same period last year, the total retail sales of consumer goods increased by 8.2% year-on-year, and the added value of the service industry increased by 6.4% year-on-year... Looking back at the semi annual report, multiple sets of high value growth data reflect the confidence of China's stable economic growth. Although the adverse effects of international environmental changes on the Chinese economy have deepened, the recovery and improvement of China's economic operation have laid a solid foundation for achieving the expected goals of economic and social development for the whole year.
Fu Linghui, spokesperson for the National Bureau of Statistics and Director of the Department of Comprehensive Statistics of the National Economy, stated that although the external environment is becoming more complex and severe, and domestic economic development is also facing pressure, the long-term fundamentals of China's economy have not changed, and the characteristics of strong resilience, great potential, and abundant vitality have not changed. The conditions supporting high-quality development have also not changed. With the accumulation of positive factors promoting development, the economy is expected to continue to recover and improve.
The main engine of consumption plays a significant role
The contribution of domestic demand is steadily increasing
According to data from the National Bureau of Statistics, consumer prices for residents in China increased by 0.7% year-on-year in the first half of the year. With the implementation and effectiveness of various policy measures to expand domestic demand, the potential for domestic demand continues to be unleashed, especially with a significant increase in the driving force of consumption on economic growth. In the first half of the year, final consumer spending drove economic growth by 4.2 percentage points; The total retail sales of consumer goods increased by 8.2% year-on-year, maintaining a rapid growth; The contribution rate of final consumption expenditure to economic growth reached 77.2%, significantly higher than last year.
Professor Sun Chuanwang from the Zouzhizhuang Institute of Economics at Xiamen University analyzed that in terms of consumption, the catering industry has significantly improved, with an income growth rate of over 20%. The total retail sales of upgraded and improved goods such as sports and entertainment products have shown a rapid growth, reflecting the increasing demand for high-quality, personalized, and diversified consumption among residents, and the steady optimization of consumption structure.
On July 1, 2023, the night market at Xiangbala Square in Gonghe County, Hainan Tibetan Autonomous Prefecture, Qinghai Province was bustling with people. Many local residents and tourists from other places came here to shop and taste the unique cuisine.
Zhang Jianping, Vice Chairman of the China Society for Socio Economic System Analysis and Research, believes that in the current consumption of Chinese residents, the scale of commodity consumption accounts for a relatively high proportion, and there is still room for growth in service consumption. The domestic demand for tourism, leisure vacation, medical care, and culture is rapidly exploding, which will become very important areas for stable growth and employment in China.
At the same time, it should also be noted that there are still issues such as relatively weak consumption capacity and expectations, and the need to improve infrastructure and consumption environment.
Jin Xiandong, Director of the Policy Research Office of the National Development and Reform Commission, stated that in the next step, the National Development and Reform Commission will focus on the pain points and bottlenecks that restrict residents from "being able to consume, daring to consume, and willing to consume", and will promptly formulate and introduce policies to restore and expand consumption, and continue to do a good job in stabilizing employment and promoting income growth; At the same time, we will promote the integration and innovation of digital technology, application scenarios, and business models, cultivate and expand new forms and models of consumption, and strive to create a comfortable and reassuring consumption environment for consumers.
The service industry is developing well
Maintaining an expanding trend of business prosperity
Preliminary calculations show that in the first half of the year, the added value of the service industry was 33193.7 billion yuan, a year-on-year increase of 6.4%. The added value of the service industry accounted for 56.0% of the gross domestic product, which is 1.6 percentage points higher than the same period last year.
Chen Yuheng, Vice Dean of the East High tech Investment Research Institute, stated that since the beginning of this year, contact and travel services have rapidly recovered, and the recovery trend of contact service industries such as accommodation and catering is particularly prominent. It is expected that after the restoration of consumer willingness in the first half of the year, there is still room for further market recovery in the second half of the year.
At the same time, service trade grew rapidly in the first half of the year. From January to May, China's total import and export volume of service trade reached 2605.54 billion yuan, a year-on-year increase of 10.2%. The import and export of travel services increased by 67% year-on-year, making it the fastest growing service trade sector.
From the perspective of the Business Activity Index of the Service Industry, the average business activity index of industries closely related to the development of the real economy, such as information transmission, software and information technology services, and finance, rose to a high prosperity range of over 60.0% in the first half of the year. In the first half of the year, the average expected index of service industry business activities was 62.5%, which was 6.0 percentage points higher than the same period last year.
Li Suoqiang, Director of the Service Industry Survey Center of the National Bureau of Statistics, analyzed that the service industry economy continued to recover in the first half of the year, but the current external environment is becoming more complex and severe, domestic demand is still insufficient, and the foundation for economic recovery is not yet stable. In the next stage, we need to accelerate the construction of a modern industrial system, further enhance development momentum, stimulate market vitality, promote the continuous improvement of the service industry economy, and achieve effective improvement in quality and reasonable growth in quantity.
Development and growth of new driving forces
Continuous promotion of high-quality development
The steady recovery of the Chinese economy is hard won, but the growth rate of some indicators has fallen, and further efforts are needed to promote sustained economic growth. Reshaping new growth drivers is the key to addressing the risks and challenges in the recovery process.
Liu Yuanchun, President of Shanghai University of Finance and Economics, believes that in the accelerated evolution of the world's unprecedented great changes, it is necessary to not only dialectically view the current problems encountered, but also to cultivate new competitiveness and strategic cooperation points, achieving a combination of long and short.
At present, China is deeply implementing the innovation driven development strategy, strengthening its strategic technological strength, and widely applying modern information technology, artificial intelligence, big data and other technologies. Innovative achievements are constantly emerging, and new industries and products are showing good growth momentum. Since the beginning of this year, the domestically produced large aircraft C919 has completed its commercial debut, and the world's first 16 MW offshore wind turbine has been lifted. Technological innovation continues to empower high-quality development.
At the same time, the consumption growth of smart products continues to increase, driving the growth of related manufacturing industries. In the first half of the year, the added value of smart consumer equipment manufacturing increased by 12% year-on-year. Focusing on overcoming the bottleneck project, the manufacturing industry of semiconductor related industries grew relatively fast in the first half of the year, with the added value of semiconductor device specific equipment manufacturing increasing by 30.9%. In terms of products, some new materials and intelligent products have grown relatively fast. In the first half of the year, the production of aerospace aluminum materials, industrial control computers, and systems increased by 23.3% and 34.1%, respectively.
On July 10, 2023, workers from an LED optoelectronic semiconductor device company in Ruichang, Jiangxi rushed to produce orders on an intelligent production line. In recent years, the company has made every effort to build intelligent workshops, implement digitalization and intelligence in the production process, and comprehensively improve production efficiency and management level.
Jin Xiandong stated that in the coming period, the National Development and Reform Commission will consolidate its leading position in traditional advantageous industries, vigorously develop advanced manufacturing industries, and continuously improve its level of high-end, intelligent, and green development; At the same time, creating new competitive advantages, forward-looking layout of future industries, accelerating the cultivation and creation of a group of new growth engines with unique characteristics, complementary advantages, and reasonable structure.
The effectiveness of green transformation is evident
Will help transform the driving force of economic growth
In the first half of the year, the production of new energy products such as new energy vehicles, solar cells, and charging stations increased by 35%, 54.5%, and 53.1% respectively. The export of "new three types" products represented by lithium batteries, solar cells, and electric passenger vehicles increased by 61.6%.
It is worth noting that, thanks to national strategic leadership and corporate innovation, China's new energy vehicle products are becoming increasingly abundant and the charging and swapping infrastructure is constantly improving, leading to a significant increase in consumer awareness and acceptance of new energy vehicles. On the basis of high growth last year, the new energy vehicle market performed well in the first half of this year. In the first half of the year, China's total production and sales of new energy vehicles reached 3.788 million and 3.747 million, with year-on-year growth of 42.4% and 44.1% respectively, and a market share of 28.3%. Among them, the cumulative sales of pure electric vehicles were 2.719 million, a year-on-year increase of 31.9%, and the sales of plug-in hybrid models were 1.025 million, a year-on-year increase of 91.1%.
Recently, the second meeting of the Central Committee for Deepening Reform approved the Opinions on Promoting the Gradual Shift of Energy Consumption Dual Control to Carbon Emission Dual Control, promoting the gradual shift of energy consumption dual control to carbon emission dual control, and helping to achieve the "dual carbon" goal.
"The pace of green energy development is accelerating, the formation of green production and lifestyle is accelerating, and the synergistic development effect of green transformation and economic growth is constantly emerging." Fu Linghui said that in the next stage, green development has abundant momentum, which will promote the improvement of economic development quality and help the transformation of economic growth momentum.
"I believe that more industries will experience this mature and iterative process, and stand out in the future to reshape the new driving force of China's economic development." Li Hui, Deputy Director of the National Economic Comprehensive Department of the National Development and Reform Commission, said that the next step will be to further improve support policies and measures, focus on guiding and encouraging new energy vehicle enterprises to seize development opportunities, enhance industrial innovation capabilities, strengthen open exchanges and cooperation, and enhance the core competitiveness of the industry.
Overall, since the beginning of this year, China's economy has gradually freed itself from the impact of the epidemic and returned to a normal track of operation, showing a trend of recovery and improvement. From the perspective of the whole year, although facing pressure and challenges, with the improvement of employment, increase in resident income, gradual enhancement of domestic demand, optimization and adjustment of supply structure, and growth and growth of new driving forces, the economy will steadily recover and the quality of development will continue to improve.
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