China Economic Quarterly Q4 2023

Pivot to high tech and policy levers to revive demand

This issue provides some key takeaways from China’s Q4 economic data and the economic outlook for 2024.

china economic quarterly q1 2023

Highlights

china economic quarterly q2 2022

In brief:

  1. China’s GDP grew 5.2% in 2023, surpassing the official target.
  2. Economic recovery was uneven in the fourth quarter, with industrial output and fixed asset investment accelerating but retail sales slowing in December.
  3. High-tech sectors continued to shine, with related industrial production, fixed asset investments, bank lending, foreign direct investment and exports growing at a faster pace than the broader economy.
  4. Anaemic consumer spending, sluggish consumer prices, and slowing imports consistently underscore the imperative for boosting domestic demand.
  5. In terms of investment, China’s pivot towards the high-tech sector is expected to continue, with recent policy highlighting the green energy sector.
  6. Policymakers will likely up their game to put a floor under the real estate sector by rolling out further supportive measures.
  7. With global demand unlikely to bounce back sharply, policymakers will need to step up economic stimulus to prop up growth.
  8. Domestic demand will pick up steam in 2024 if policymakers roll out larger-scale, more coordinated policy measures to shore up household and business confidence. 

Topic in focus: 2024 economic outlook

Looking ahead, we expect China’s economic recovery to continue in 2024, driven by stabilising exports and a continuing pivot towards high-tech investments. This year will also mark China’s transition into a new normal – a slower but more balanced trajectory of economic growth. To further accelerate the economic recovery, it will be crucial for the government to roll out larger-scale support measures to stimulate domestic demand. Below, we highlight six key areas to watch in 2024:

  • GDP – Shifting gears towards more sustainable and balanced growth
  • China’s property sector: Less of a drag on economic growth
  • Pivot towards high-tech and green sectors
  • Consumer spending: Weak confidence still clouds the horizon
  • Light at the end of the export tunnel?
  • Economic stimulus – From a piecemeal approach to bringing out the big guns

Contact us

Elton Yeung

Vice Chairman, PwC China

Tel: +[86] (10) 6533 8008

Thomas Leung

Managing Partner - Markets, PwC China

Tel: +[86] (10) 6533 2838 / +[852] 2289 8288

Jackie Yan

Economist, PwC China

Tel: +[852] 2289 5460

Follow us