Unemployment rates among Chinese youth jumped to a record high of 21.3 per cent in June, reported the nation's National Bureau of Statistics (NBS) on Monday. In May, this rate for youth between the ages of 16 and 24 years stood at 20.8 per cent, which at the time was a record high.

Even as the unemployment rate for youth saw a spike, as per the NBS, the overall urban employment rate remained steady at 5.2 per cent.

<h2>A 'wait-and-see' attitude</h2>

As per Murphy Cruise, an economist at ratings agency Moody's low demand is driving the unemployment. He says that a low demand means that companies are hesitating to hire. They are taking a "wait-and-see" attitude before expanding operations, he added.

Also read | <a href="https://www.wionews.com/world/fresh-graduates-in-china-pose-like-corpses-to-stage-silent-protest-over-lack-of-jobs-608885">Fresh graduates in China pose like corpses to stage silent protest over lack of jobs</a>

Cruise said that adding to the hesitation are memories of repeated lockdowns and suddenly shifting policies that were part of 2022.

"Unfortunately... a revival in business activity is needed for broader demand to lift. That stalemate is keeping business activity weak," he said.

<h2>Economic growth</h2>

Official data shows that China's economy, grew by 6.3 per cent year-on-year in the second quarter of 2023. Analysts, however, were expecting a 7.1 per cent rebound, reports AFP.

In a statement, Beijing's National Bureau of Statistics said that the nation's economy "showed a good momentum of recovery".

"By quarter, the GDP grew by 4.5 per cent year-on-year in the first quarter and 6.3 percent in the second quarter," said NBS spokesman Fu Linghui.

Also read | <a href="https://www.wionews.com/business-economy/us-hiring-falls-short-of-expectations-in-june-signalling-cooling-economy-ahead-of-fed-decision-613241">US hiring falls short of expectations in June, signalling cooling economy ahead of Fed decision</a>

"Market demand gradually recovered, production supply continued to increase, employment and price were generally stable, and residents' income grew steadily," he added.

However, the realistic growth in quarter-on-quarter terms shows that China's economy expanded by just 0.8 per cent between April and June. In comparison, the previous three months saw a 2.2 per cent growth.

<h2>Inflated economic growth</h2>

Analysts as per AFP had warned that China's growth figure could be misleading given the low base of comparison set by a year wrought by pandemic.

This time, a year ago, China which was wracked by sudden lockdowns, travel curbs and factory shutdowns, had reported a meagre 0.4 per cent growth — one of its lowest quarterly readings in recent years.

(With inputs from agencies)

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Unemployment rates among Chinese youth jumped to a record high of 21.3 per cent in June, reported the nation's National Bureau of Statistics (NBS) on Monday. In May, this rate for youth between the ages of 16 and 24 years stood at 20.

Unemployment rates among Chinese youth jumped to a record high of 21.3 per cent in June, reported the nation's National Bureau of Statistics (NBS) on Monday. In May, this rate for youth between the ages of 16 and 24 years stood at 20.8 per cent, which at the time was a record high. Even as the unemployment rate for youth saw a spike, as per the NBS, the overall urban employment rate remained steady at 5.2 per cent. A 'wait-and-see' attitude As per Murphy Cruise, an economist at ratings agency Moody's low demand is driving the unemployment. He says that a low demand means that companies are hesitating to hire. They are taking a "wait-and-see" attitude before expanding operations, he added. Also read | Fresh graduates in China pose like corpses to stage silent protest over lack of jobs Cruise said that adding to the hesitation are memories of repeated lockdowns and suddenly shifting policies that were part of 2022. "Unfortunately... a revival in business activity is needed for broader demand to lift. That stalemate is keeping business activity weak," he said. Economic growth Official data shows that China's economy, grew by 6.3 per cent year-on-year in the second quarter of 2023. Analysts, however, were expecting a 7.1 per cent rebound, reports AFP. In a statement, Beijing's National Bureau of Statistics said that the nation's economy "showed a good momentum of recovery". "By quarter, the GDP grew by 4.5 per cent year-on-year in the first quarter and 6.3 percent in the second quarter," said NBS spokesman Fu Linghui. Also read | US hiring falls short of expectations in June, signalling cooling economy ahead of Fed decision "Market demand gradually recovered, production supply continued to increase, employment and price were generally stable, and residents' income grew steadily," he added. However, the realistic growth in quarter-on-quarter terms shows that China's economy expanded by just 0.8 per cent between April and June. In comparison, the previous three months saw a 2.2 per cent growth. Inflated economic growth Analysts as per AFP had warned that China's growth figure could be misleading given the low base of comparison set by a year wrought by pandemic. This time, a year ago, China which was wracked by sudden lockdowns, travel curbs and factory shutdowns, had reported a meagre 0.4 per cent growth — one of its lowest quarterly readings in recent years. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

June saw China youth employment at record high of 21.3%; economy grew by 6.3%

China's economy showed further signs of weakness in the second quarter. The nation's GDP expanded by 0.8 per cent during April-June, compared with the previous quarter; and worryingly, youth unemployment has hit a record high. Data shows missed growth expectations, and consumers remain cautious, adding pressure on leaders to unveil further stimulus. Here is a look at the main storm clouds over China's economy.

China: Youth unemployment at record high | In-depth analysis

China's economy has shown&nbsp;further signs of weakness in the second quarter. The nation's GDP expanded by 0.8 per cent during April-June, compared with the previous quarter; and worryingly, youth unemployment has hit a record high. The latest data shows that the economy has missed growth expectations&nbsp;and consumers continue to remain cautious. As a result, Chinese policymakers are under increasing pressure&nbsp;to unveil a stimulus package for the world's second-largest economy.&nbsp;

Here is a look at the main storm clouds over China's economy.

Sluggish consumption

For almost 3 years, strict zero-Covid policies meant repeated lockdowns, the fear of being arbitrarily quarantined and other draconian health measures. When the restrictions were lifted at the end of 2022, millions flocked to restaurants, shopping malls and on long-awaited holidays. However, that optimism hasn't lasted, with the recovery running out of steam and the labour market under pressure.

Moreover, more than one in five young people is unemployed. As per China's National Bureau of Statistics, unemployment among Chinese youths jumped to a record 21.3 per cent in June. Overall, urban unemployment remained at 5.2 per cent.&nbsp;

Real estate crisis

Brick and mortar are a pillar of the Chinese economy. Property has long been seen as a safe bet for middle-class Chinese seeking to grow their wealth. The demand sent property prices soaring, while developers expanded at breakneck speed thanks to generous bank loans. But as the real estate companies' debts reached unsustainable heights, authorities pushed the brakes in 2020.

Since then, developers' access to credit has been considerably reduced. The most vulnerable entities are struggling to complete their projects, fuelling a crisis of confidence with potential buyers that is depressing prices.

China's central bank last week decided to extend its support for developers, notably through loan repayment extensions, until the end of 2024. The decision came after officials cut interest rates last month. Analysts say the measures are insufficient to save the sector.

Fear of&nbsp;looming deflation

For months, prices in China have been virtually flat. While on paper, this may seem like a good thing for purchasing power, a drop into deflation would pose a long-term threat. Instead of spending, consumers postpone purchases in the hope of lower prices.

And in the absence of demand, companies cut back on production, freeze hiring or lay off staff and agree to further price cuts to clear their inventories. It consequentially weighs on profitability as the companies' costs remain the same.

Chinese trade under threat

China, long described as the workshop of the world, remains highly dependent on exports, making it vulnerable to changes in the global economy. The threat of recession in the US and Europe, combined with galloping inflation, is weakening international demand for Chinese products. In June, exports fell for the second month in a row.

Geopolitical tensions

President Xi Jinping is seemingly struggling to navigate through geopolitical tensions. Tensions between China and the United States have also hurt the economic outlook.

Washington officials are working to de-risk their economy from China.

The US is working to tighten restrictions on semiconductor exports, and is pressuring allies to do the same. Last week, the Chinese customs spokesperson blamed outside forces having a direct impact on Chinese trade.

Debt burden on local authorities

Also dragging on the economy is the dire finances of some local authorities after three years of astronomical spending to combat Covid-19. The real estate crisis has deprived them of a major source of property income.

China's economy has shown further signs of weakness in the second quarter. The nation's GDP expanded by 0.8 per cent during April-June, compared with the previous quarter; and worryingly, youth unemployment has hit a record high.

China's economy has shown further signs of weakness in the second quarter. The nation's GDP expanded by 0.8 per cent during April-June, compared with the previous quarter; and worryingly, youth unemployment has hit a record high. The latest data shows that the economy has missed growth expectations and consumers continue to remain cautious. As a result, Chinese policymakers are under increasing pressure to unveil a stimulus package for the world's second-largest economy. Here is a look at the main storm clouds over China's economy. Sluggish consumption For almost 3 years, strict zero-Covid policies meant repeated lockdowns, the fear of being arbitrarily quarantined and other draconian health measures. When the restrictions were lifted at the end of 2022, millions flocked to restaurants, shopping malls and on long-awaited holidays. However, that optimism hasn't lasted, with the recovery running out of steam and the labour market under pressure. Moreover, more than one in five young people is unemployed. As per China's National Bureau of Statistics, unemployment among Chinese youths jumped to a record 21.3 per cent in June. Overall, urban unemployment remained at 5.2 per cent. Real estate crisis Brick and mortar are a pillar of the Chinese economy. Property has long been seen as a safe bet for middle-class Chinese seeking to grow their wealth. The demand sent property prices soaring, while developers expanded at breakneck speed thanks to generous bank loans. But as the real estate companies' debts reached unsustainable heights, authorities pushed the brakes in 2020. Since then, developers' access to credit has been considerably reduced. The most vulnerable entities are struggling to complete their projects, fuelling a crisis of confidence with potential buyers that is depressing prices. China's central bank last week decided to extend its support for developers, notably through loan repayment extensions, until the end of 2024. The decision came after officials cut interest rates last month. Analysts say the measures are insufficient to save the sector. Fear of looming deflation For months, prices in China have been virtually flat. While on paper, this may seem like a good thing for purchasing power, a drop into deflation would pose a long-term threat. Instead of spending, consumers postpone purchases in the hope of lower prices. And in the absence of demand, companies cut back on production, freeze hiring or lay off staff and agree to further price cuts to clear their inventories. It consequentially weighs on profitability as the companies' costs remain the same. Chinese trade under threat China, long described as the workshop of the world, remains highly dependent on exports, making it vulnerable to changes in the global economy. The threat of recession in the US and Europe, combined with galloping inflation, is weakening international demand for Chinese products. In June, exports fell for the second month in a row. Geopolitical tensions President Xi Jinping is seemingly struggling to navigate through geopolitical tensions. Tensions between China and the United States have also hurt the economic outlook. Washington officials are working to de-risk their economy from China. The US is working to tighten restrictions on semiconductor exports, and is pressuring allies to do the same. Last week, the Chinese customs spokesperson blamed outside forces having a direct impact on Chinese trade. Debt burden on local authorities Also dragging on the economy is the dire finances of some local authorities after three years of astronomical spending to combat Covid-19. The real estate crisis has deprived them of a major source of property income.

Decoded: 6 reasons why China's economy is struggling

Here we bring you a quick round-up of all the latest news and top headlines from all across the globe: Air Canada plane catches fire at Quebec airport, Chinese economy in cold soup, India fails to draw China +1 funds, Harley Davidson bets on India, Yellow alert issued in Delhi for the next 24 hours, Flash floods hit New York.

Air Canada plane catches fire at Quebec airport | Chinese economy in cold soup | WION Speed News

China's factory activity declined for the third consecutive month in June, accompanied by a deepening weakness in other sectors, according to official surveys cited by Reuters released on Friday. These developments have added pressure on Chinese authorities to take additional measures to bolster economic growth as both domestic and international demand falter.

Although China's economy had surpassed expectations with faster-than-anticipated growth in the first quarter, driven mainly by a post-COVID rebound in consumption, policymakers have struggled to maintain this momentum in the second quarter. The National Bureau of Statistics reported that the services sector, which has been a key driver of growth, also experienced its weakest reading since China lifted its strict COVID-related restrictions in late 2020.

A Stumbling Economy

The official manufacturing purchasing managers' index (PMI) inched up to 49.0 in June from May's 48.8, remaining below the 50-point mark that indicates expansion and is in line with predictions. Conversely, the non-manufacturing PMI declined to 53.2 from May's 54.50, signaling a slowdown in service sector activity and construction.

Reuters cited Rob Carnell, the regional head of research Asia-Pacific at ING, who highlighted that domestic tourism and dining out had initially helped to compensate for lost time earlier in the year. However, he emphasized that such activities can only sustain growth for a limited period. Retail sales indicators also indicate that they remain above historical trends but suggest a moderation in the second half of the year.

The separate services index from the National Bureau of Statistics fell to 52.8 in June from May's 53.8, reaching its lowest level since December when China eased its COVID restrictions. The release of these figures initially led to a decline in the yuan's value, reaching a seven-month low, and the Australian dollar, which hit a three-week low. However, both currencies later recovered from their losses.

Reuters cited Julian Evans-Pritchard, the head of China economics at Capital Economics, who noted that after a brief boost from the reopening, the service sector seems to be settling into a new normal of slower growth in the post-pandemic period.

Recovery Anticipation and Reality

Economists had initially anticipated that China's economy would recover quickly and become a significant driver of global growth after the abandonment of COVID controls. However, analysts are now downgrading their forecasts for the remainder of the year. Nomura, in particular, has been the most bearish, revising its growth forecast for China's gross domestic product (GDP) this year to 5.1 per cent from 5.5 per cent. This downgrade accounts for the potential impact of new stimulus measures. The PMI data indicated that new export orders have contracted for the third consecutive month.

Reuters cited Bruce Pang, the chief economist, and head of research for Greater China at Jones Lang LaSalle, who highlighted the imbalances and weaknesses reflected in the June PMI, including the continuous contraction of both domestic and external demand, an accelerated slowdown in the operations of small enterprises, and mounting pressure on the private economy. Pang emphasized the urgent need for a more substantial package of policy measures to achieve annual growth targets.

China's Economic Recovery Pledge

The Chinese government has set a modest GDP growth target of around 5 per cent for this year after falling short of its 2022 goal. This month, China's cabinet pledged to promote a sustained economic recovery 'in a timely manner.' While addressing the World Economic Forum summit in Tianjin, Premier Li Qiang reiterated Beijing's commitment to boost demand but did not announce any specific policies.

China has already reduced key lending benchmark rates this month to support economic activity. Although sources involved in policy discussions have indicated that China will implement additional stimulus measures, concerns about debt and capital flight may limit the scope of these measures to primarily address weak demand in the consumer and private sectors.

According to ING's Rob Carnell, cited by Reuters, he expects the government to provide some support but anticipates that it will be in the form of smaller, targeted measures rather than a large-scale financial stimulus. He stated that these measures may not substantially impact GDP growth. 
&nbsp;

(With Inputs from Reuters)

China's factory activity declined for the third consecutive month in June, accompanied by a deepening weakness in other sectors, according to official surveys cited by Reuters released on Friday.

China's factory activity declined for the third consecutive month in June, accompanied by a deepening weakness in other sectors, according to official surveys cited by Reuters released on Friday. These developments have added pressure on Chinese authorities to take additional measures to bolster economic growth as both domestic and international demand falter. Although China's economy had surpassed expectations with faster-than-anticipated growth in the first quarter, driven mainly by a post-COVID rebound in consumption, policymakers have struggled to maintain this momentum in the second quarter. The National Bureau of Statistics reported that the services sector, which has been a key driver of growth, also experienced its weakest reading since China lifted its strict COVID-related restrictions in late 2020. A Stumbling Economy The official manufacturing purchasing managers' index (PMI) inched up to 49.0 in June from May's 48.8, remaining below the 50-point mark that indicates expansion and is in line with predictions. Conversely, the non-manufacturing PMI declined to 53.2 from May's 54.50, signaling a slowdown in service sector activity and construction. Reuters cited Rob Carnell, the regional head of research Asia-Pacific at ING, who highlighted that domestic tourism and dining out had initially helped to compensate for lost time earlier in the year. However, he emphasized that such activities can only sustain growth for a limited period. Retail sales indicators also indicate that they remain above historical trends but suggest a moderation in the second half of the year. The separate services index from the National Bureau of Statistics fell to 52.8 in June from May's 53.8, reaching its lowest level since December when China eased its COVID restrictions. The release of these figures initially led to a decline in the yuan's value, reaching a seven-month low, and the Australian dollar, which hit a three-week low. However, both currencies later recovered from their losses. Reuters cited Julian Evans-Pritchard, the head of China economics at Capital Economics, who noted that after a brief boost from the reopening, the service sector seems to be settling into a new normal of slower growth in the post-pandemic period. Recovery Anticipation and Reality Economists had initially anticipated that China's economy would recover quickly and become a significant driver of global growth after the abandonment of COVID controls. However, analysts are now downgrading their forecasts for the remainder of the year. Nomura, in particular, has been the most bearish, revising its growth forecast for China's gross domestic product (GDP) this year to 5.1 per cent from 5.5 per cent. This downgrade accounts for the potential impact of new stimulus measures. The PMI data indicated that new export orders have contracted for the third consecutive month. Reuters cited Bruce Pang, the chief economist, and head of research for Greater China at Jones Lang LaSalle, who highlighted the imbalances and weaknesses reflected in the June PMI, including the continuous contraction of both domestic and external demand, an accelerated slowdown in the operations of small enterprises, and mounting pressure on the private economy. Pang emphasized the urgent need for a more substantial package of policy measures to achieve annual growth targets. China's Economic Recovery Pledge The Chinese government has set a modest GDP growth target of around 5 per cent for this year after falling short of its 2022 goal. This month, China's cabinet pledged to promote a sustained economic recovery 'in a timely manner.' While addressing the World Economic Forum summit in Tianjin, Premier Li Qiang reiterated Beijing's commitment to boost demand but did not announce any specific policies. China has already reduced key lending benchmark rates this month to support economic activity. Although sources involved in policy discussions have indicated that China will implement additional stimulus measures, concerns about debt and capital flight may limit the scope of these measures to primarily address weak demand in the consumer and private sectors. According to ING's Rob Carnell, cited by Reuters, he expects the government to provide some support but anticipates that it will be in the form of smaller, targeted measures rather than a large-scale financial stimulus. He stated that these measures may not substantially impact GDP growth. (With Inputs from Reuters)

China's manufacturing sector continues to contract, heightening growth concerns

China's economy faces a dual challenge as youth unemployment reaches an alarming record high, while major economic indicators fall short of expectations.&nbsp;

According to the latest data released by China's National Bureau of Statistics, the unemployment rate among young people aged 16 to 24 soared to a record high of 20.8 percent in May, surpassing the previous peak observed in April. The surge in unemployment&nbsp;indicates that young individuals are encountering significant challenges in finding jobs, as the labour market becomes increasingly competitive.&nbsp;

China's economic performance has been facing&nbsp;setbacks as major indicators continue to&nbsp;fall short of expectations. Retail sales in May grew by 12.7 percent compared to the previous year, failing to meet the projected 13.6 percent growth predicted by experts. Similarly, industrial production only rose by a modest 3.5 percent year-on-year, slightly below the anticipated 3.6 percent as predicted by analysts. Moreover, fixed asset investment for the first five months of the year registered a growth rate of 4 percent, slower than the 4.4 percent forecasted by Reuters. These underwhelming figures point towards a potential slowdown in China's economic recovery and raise concerns about the sustainability of growth.

Acknowledging&nbsp;the challenges posed by the uncertain international environment, the National Bureau of Statistics has&nbsp;pushed for more&nbsp;domestic structural adjustments. Despite the current setbacks, there is cautious optimism for the future. Bureau spokesperson Fu Linghui has expressed optimism about China's economic growth in the second quarter, taking into account the low base of comparison from the previous year. Linghui also anticipates a return to a 'normal' growth pace in the third and fourth quarters. The Chinese government aims to achieve its full-year growth target of around 5 percent GDP growth for 2023.

To counter the economic challenges, experts suggest implementing policy stimulus measures to bolster economic&nbsp;recovery. China has already taken steps to loosen monetary policy, including cutting deposit rates and reducing the seven-day reverse repurchase rate. Furthermore, slowing global growth has affected China's export sector, particularly in the United States and Europe. May's export data showed a significant decline of 7.5 percent year-on-year, highlighting the impact of external factors on China's economic performance. However, there was a slight positive note as imports dropped less than anticipated, down by 4.5 percent from the previous year.

China's economy faces a dual challenge as youth unemployment reaches an alarming record high, while major economic indicators fall short of expectations. According to the latest data released by China's National Bureau of Statistics, the unemployment rate among young people aged 16 to 24 soared to a record high of 20.

China's economy faces a dual challenge as youth unemployment reaches an alarming record high, while major economic indicators fall short of expectations. According to the latest data released by China's National Bureau of Statistics, the unemployment rate among young people aged 16 to 24 soared to a record high of 20.8 percent in May, surpassing the previous peak observed in April. The surge in unemployment indicates that young individuals are encountering significant challenges in finding jobs, as the labour market becomes increasingly competitive. China's economic performance has been facing setbacks as major indicators continue to fall short of expectations. Retail sales in May grew by 12.7 percent compared to the previous year, failing to meet the projected 13.6 percent growth predicted by experts. Similarly, industrial production only rose by a modest 3.5 percent year-on-year, slightly below the anticipated 3.6 percent as predicted by analysts. Moreover, fixed asset investment for the first five months of the year registered a growth rate of 4 percent, slower than the 4.4 percent forecasted by Reuters. These underwhelming figures point towards a potential slowdown in China's economic recovery and raise concerns about the sustainability of growth. Acknowledging the challenges posed by the uncertain international environment, the National Bureau of Statistics has pushed for more domestic structural adjustments. Despite the current setbacks, there is cautious optimism for the future. Bureau spokesperson Fu Linghui has expressed optimism about China's economic growth in the second quarter, taking into account the low base of comparison from the previous year. Linghui also anticipates a return to a 'normal' growth pace in the third and fourth quarters. The Chinese government aims to achieve its full-year growth target of around 5 percent GDP growth for 2023. To counter the economic challenges, experts suggest implementing policy stimulus measures to bolster economic recovery. China has already taken steps to loosen monetary policy, including cutting deposit rates and reducing the seven-day reverse repurchase rate. Furthermore, slowing global growth has affected China's export sector, particularly in the United States and Europe. May's export data showed a significant decline of 7.5 percent year-on-year, highlighting the impact of external factors on China's economic performance. However, there was a slight positive note as imports dropped less than anticipated, down by 4.5 percent from the previous year.

Surging youth unemployment casts shadow on China's economic outlook

The government of Chinese President Xi Jinping has reportedly been exerting pressure&nbsp;to boost the country's economy as Beijing is mulling a broad package of stimulus measures, Bloomberg reported citing people familiar with the matter.&nbsp;

Earlier this month, Bloomberg quoted sources to report that after existing policies failed to sustain a rebound in the property market, China aimed at introducing a set of measures to support the ailing sector.&nbsp;

While speaking on the condition of anonymity, the sources told the outlet that the measures are designed to support areas such as real estate and domestic demand. They also mentioned that interest rate reductions, supporting the real estate market, and more key areas are under consideration.&nbsp;

As quoted, one person said that regulators are seeking to lower costs on outstanding residential mortgages and boost re-lending through the nation's policy banks. They want to ensure homes are delivered.&nbsp;

This comes as the news agency Reuters reported that China's central bank cut short-term borrowing costs on Tuesday to help restore confidence. The move signalled possible easing for longer-term rates.&nbsp;

The plan is not final yet, and the State Council may discuss the policies as soon as this Friday. They might make some amends in the policies during the discussion.&nbsp;

According to Larry Hu, who is the head of China economics at Macquarie Group Ltd, the rate cut signals Beijing's stance is turning more supportive.&nbsp;

Also read:&nbsp;<a href="https://www.wionews.com/world/former-samsung-electronics-executive-accused-of-stealing-secrets-for-china-chip-factory-603612">Former Samsung Electronics executive accused of stealing secrets for China chip factory</a>&nbsp;

As quoted by Bloomberg, Hu said that "policy is the only game changer" in the face of weak consumer and business confidence in the economy.&nbsp;

Hu added, "The rate cut today sent a clear signal that policy would turn more supportive in the coming months, a significant shift from the tapering in stimulus since April."&nbsp;

<h2>China's new loans in May miss forecasts</h2>

Reuters mentioned in its report that China's new bank loans picked up in May from the previous month, amid an economy-friendy policy being accommodated by the central bank. However, the signs of slowing momentum have raised expectations that more stimulus may be needed to sustain the recovery.&nbsp;

Analysts have said that the weaker-than-expected credit data could strengthen the case for policymakers to roll out more support steps, including a cut in the benchmark lending rate this month.&nbsp;

Also read:&nbsp;<a href="https://www.wionews.com/world/china-searching-waters-where-north-korean-satellite-crashed-south-korea-603520">China searching waters where North Korean satellite crashed: South Korea</a>&nbsp;

Watch:&nbsp;Gravitas: India-China relations hit an all-time low. Here's why&nbsp;

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New bank lending rose to $190.18 billion in May, data from the People's Bank of China (PBOC) showed on Tuesday. The figures are up from April but missed analysts' estimates.&nbsp;

According to the economists polled by Reuters, it was expected that new yuan loans would jump to 1.6 trillion yuan last month, versus 718.8 billion yuan in April and against 1.89 trillion yuan a year earlier.&nbsp;

As quoted by the news agency, Zhiwei Zhang, chief economist at Pinpoint Asset Management, said in a note: "The credit growth is weak, which is not surprising as other economic indicators such as PMI and exports also sent consistent signals."&nbsp;

"This explains why the PBOC cut the reverse repo rate this morning. It is a small step in the right direction. I expect more policy actions to follow in coming weeks," Zhang added.&nbsp;

(With inputs from agencies)&nbsp;

 
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The government of Chinese President Xi Jinping has reportedly been exerting pressure to boost the country's economy as Beijing is mulling a broad package of stimulus measures, Bloomberg reported citing people familiar with the matter.

The government of Chinese President Xi Jinping has reportedly been exerting pressure to boost the country's economy as Beijing is mulling a broad package of stimulus measures, Bloomberg reported citing people familiar with the matter. Earlier this month, Bloomberg quoted sources to report that after existing policies failed to sustain a rebound in the property market, China aimed at introducing a set of measures to support the ailing sector. While speaking on the condition of anonymity, the sources told the outlet that the measures are designed to support areas such as real estate and domestic demand. They also mentioned that interest rate reductions, supporting the real estate market, and more key areas are under consideration. As quoted, one person said that regulators are seeking to lower costs on outstanding residential mortgages and boost re-lending through the nation's policy banks. They want to ensure homes are delivered. This comes as the news agency Reuters reported that China's central bank cut short-term borrowing costs on Tuesday to help restore confidence. The move signalled possible easing for longer-term rates. The plan is not final yet, and the State Council may discuss the policies as soon as this Friday. They might make some amends in the policies during the discussion. According to Larry Hu, who is the head of China economics at Macquarie Group Ltd, the rate cut signals Beijing's stance is turning more supportive. Also read: Former Samsung Electronics executive accused of stealing secrets for China chip factory As quoted by Bloomberg, Hu said that "policy is the only game changer" in the face of weak consumer and business confidence in the economy. Hu added, "The rate cut today sent a clear signal that policy would turn more supportive in the coming months, a significant shift from the tapering in stimulus since April." China's new loans in May miss forecasts Reuters mentioned in its report that China's new bank loans picked up in May from the previous month, amid an economy-friendy policy being accommodated by the central bank. However, the signs of slowing momentum have raised expectations that more stimulus may be needed to sustain the recovery. Analysts have said that the weaker-than-expected credit data could strengthen the case for policymakers to roll out more support steps, including a cut in the benchmark lending rate this month. Also read: China searching waters where North Korean satellite crashed: South Korea Watch: Gravitas: India-China relations hit an all-time low. Here's why × New bank lending rose to $190.18 billion in May, data from the People's Bank of China (PBOC) showed on Tuesday. The figures are up from April but missed analysts' estimates. According to the economists polled by Reuters, it was expected that new yuan loans would jump to 1.6 trillion yuan last month, versus 718.8 billion yuan in April and against 1.89 trillion yuan a year earlier. As quoted by the news agency, Zhiwei Zhang, chief economist at Pinpoint Asset Management, said in a note: "The credit growth is weak, which is not surprising as other economic indicators such as PMI and exports also sent consistent signals." "This explains why the PBOC cut the reverse repo rate this morning. It is a small step in the right direction. I expect more policy actions to follow in coming weeks," Zhang added. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

China mulling broad stimulus to prop ailing real estate sector, boost economy: Report

China's economy is causing a stir in the world of global finance. Financial markets are flashing warning signs, signaling potential trouble ahead. however, some analysts believe that wall street may be missing the forest for the trees, failing to grasp the long-term perspective.

China’s economic fluctuations puzzle wall street | World Business Watch

All eyes will be on China when it releases its latest economic data on Tuesday.

Many China watchers feel that the monthly data is likely to show China's economy doing a lot better than in reality.&nbsp;

Industrial output and retail sales are likely to have grown rapidly in April compared to the same period last year. This is because of the rebound in demand and recovery of supply chains after Covid restrictions were lifted in late 2022.&nbsp;

But the world must take the data with a major caveat -- the low base effect. Many analysts believe that comparing the upcoming data with last year won't be the right thing to do.&nbsp;

“China’s April activity data will probably offer another instance of headline figures that can’t be taken at face value," Bloomberg quoted economists Chang Shu and David Qu as saying.&nbsp;

It is to be noted that China's economy slowed down significantly last year after the government imposed strict Covid-19 restrictions, especially in Shanghai - the commercial hub of China.&nbsp;

In 2022, China grew by just 3 percent, the lowest rate in nearly 40 years.&nbsp;

Instead, analysts are likely to compare the April data with the previous months of 2023 for a better perspective.

Recent figures have shown that all is not well in China.

Cooling of demand is clearly visible in China, as consumer prices barely grew last month. At 0.1 percent year-on-year growth, inflation rate in April 2023 was the slowest since 2021.&nbsp;

Housing market sales have starting to fizzle after housing sales and prices recovered briefly following a 18-month-long slump, as per a Bloomberg report. Notably, the property sector is crucial for China's economy as it accounts for one-fifth of the Gross Domestic Product.&nbsp;

Imports and exports, too, have slowed down amid a global downturn.

China's exports in March grew by 14.8 percent year-on-year, but slowed down to 8.5 percent in April. On the other hand, China's imports shrunk 1.4 percent (year-on-year) in March. The overall fall in imports widening to 7.9 percent in April.&nbsp;

Now, only time will tell if China can lead the global growth this year as the International Monetary Fund projects.&nbsp;

&nbsp;

(With agency inputs)&nbsp;

All eyes will be on China when it releases its latest economic data on Tuesday. Many China watchers feel that the monthly data is likely to show China's economy doing a lot better than in reality.

All eyes will be on China when it releases its latest economic data on Tuesday. Many China watchers feel that the monthly data is likely to show China's economy doing a lot better than in reality. Industrial output and retail sales are likely to have grown rapidly in April compared to the same period last year. This is because of the rebound in demand and recovery of supply chains after Covid restrictions were lifted in late 2022. But the world must take the data with a major caveat -- the low base effect. Many analysts believe that comparing the upcoming data with last year won't be the right thing to do. “China’s April activity data will probably offer another instance of headline figures that can’t be taken at face value," Bloomberg quoted economists Chang Shu and David Qu as saying. It is to be noted that China's economy slowed down significantly last year after the government imposed strict Covid-19 restrictions, especially in Shanghai - the commercial hub of China. In 2022, China grew by just 3 percent, the lowest rate in nearly 40 years. Instead, analysts are likely to compare the April data with the previous months of 2023 for a better perspective. Recent figures have shown that all is not well in China. Cooling of demand is clearly visible in China, as consumer prices barely grew last month. At 0.1 percent year-on-year growth, inflation rate in April 2023 was the slowest since 2021. Housing market sales have starting to fizzle after housing sales and prices recovered briefly following a 18-month-long slump, as per a Bloomberg report. Notably, the property sector is crucial for China's economy as it accounts for one-fifth of the Gross Domestic Product. Imports and exports, too, have slowed down amid a global downturn. China's exports in March grew by 14.8 percent year-on-year, but slowed down to 8.5 percent in April. On the other hand, China's imports shrunk 1.4 percent (year-on-year) in March. The overall fall in imports widening to 7.9 percent in April. Now, only time will tell if China can lead the global growth this year as the International Monetary Fund projects. (With agency inputs)

Rebound or downturn?: China to release key economic data on Tuesday

All eyes will be on China this time after it releases its latest economic data on Tuesday. The data is likely to show China's economy doing a lot better than reality. The industrial output and retail sales are likely to have grown rapidly in April compared to the same period last year.

China's economic data may mask it's decline this time after Covid hurt it's growth | World DNA

China's gross domestic product (GDP) expanded 4.5 percent in the first quarter of the year 2023, boosted by increased consumption and retail sales.

China's GDP jumps 4.5% in Q1 as consumption, retail sales grow

China's new Premier Li Qiang warned on Monday that it would be no easy task for the country to hit its annual growth target, already one of Beijing's lowest in decades.

Not easy to achieve target, need to double our efforts for the target: Li Qiang

At the annual session of the National People's Congress on Sunday, China set a modest economic target of "around 5 per cent" for 2023 as it geared up for several challenges, including weakening demand for Chinese exports, and crackdown on the private sector.

Making the announcement, outgoing Premier Li Keqiang stressed on the need for economic stability and expanding consumption. He also said that China is looking to set a goal to create around 12 million urban jobs this year.

He set a budget deficit target at 3&nbsp;per cent of the gross domestic product (GDP), widening from a goal of around 2.8 per cent last year.

"We should give priority to the recovery and expansion of consumption," said Li, whose speech lasted for almost an hour in the opening session of the parliament, which will function till March 13, according to Reuters news agency.

<h2>Intelligence chiefs from 25 countries&nbsp;meet&nbsp;in India</h2>

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"The incomes of urban and rural residents should be boosted through multiple channels. We should stabilise spending on big-ticket items and promote recovery in consumption of consumer services," he was quoted as saying.

Last year, China grew by just 3 per cent, one of its worst performances in decades, as it continued to reel under three years of severe COVID-19 restrictions.

Also read |&nbsp;<a href="https://www.wionews.com/world/china-increases-its-military-budget-to-72-per-cent-for-2023-eyes-peaceful-reunification-with-taiwan-568690">China increases its military budget to 7.2 per cent for 2023</a>

In his work report, outgoing Premier Li Keqiang emphasised the need for economic stability and expanding consumption, setting a goal to create around 12 million urban jobs this year, up from last year's target of at least 11 million.

The GDP growth target of 5 per cent was lower than the average forecasts of economists who predicted a goal in the range of 5.5-6 per cent.

"China's economy is staging a steady recovery and demonstrating vast potential and momentum for further growth," Li said.

He warned that “uncertainties in the external environment are on the rise”, noting high global inflation.

(With inputs from agencies) 
 
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At the annual session of the National People's Congress on Sunday, China set a modest economic target of "around 5 per cent" for 2023 as it geared up for several challenges, including weakening demand for Chinese exports, and crackdown on the private sector.

At the annual session of the National People's Congress on Sunday, China set a modest economic target of "around 5 per cent" for 2023 as it geared up for several challenges, including weakening demand for Chinese exports, and crackdown on the private sector. Making the announcement, outgoing Premier Li Keqiang stressed on the need for economic stability and expanding consumption. He also said that China is looking to set a goal to create around 12 million urban jobs this year. He set a budget deficit target at 3 per cent of the gross domestic product (GDP), widening from a goal of around 2.8 per cent last year. "We should give priority to the recovery and expansion of consumption," said Li, whose speech lasted for almost an hour in the opening session of the parliament, which will function till March 13, according to Reuters news agency. Intelligence chiefs from 25 countries meet in India "The incomes of urban and rural residents should be boosted through multiple channels. We should stabilise spending on big-ticket items and promote recovery in consumption of consumer services," he was quoted as saying. Last year, China grew by just 3 per cent, one of its worst performances in decades, as it continued to reel under three years of severe COVID-19 restrictions. Also read | China increases its military budget to 7.2 per cent for 2023 In his work report, outgoing Premier Li Keqiang emphasised the need for economic stability and expanding consumption, setting a goal to create around 12 million urban jobs this year, up from last year's target of at least 11 million. The GDP growth target of 5 per cent was lower than the average forecasts of economists who predicted a goal in the range of 5.5-6 per cent. "China's economy is staging a steady recovery and demonstrating vast potential and momentum for further growth," Li said. He warned that “uncertainties in the external environment are on the rise”, noting high global inflation. (With inputs from agencies) WATCH WION LIVE HERE

China sets modest economic growth target of 5% for 2023

China's manufacturing activity expanded at the fastest pace in over a decade in February, smashing expectations as production zoomed after the lifting of Covid curbs. On Wednesday (March 1), the country's official manufacturing purchasing managers' index (PMI) climbed to 52.6 in February compared to &nbsp;50.1 in January, the news agency Reuters reported. The PMI far exceeded an analyst forecast of 50.5 and was the highest reading since April 2012.&nbsp;

Global markets cheered the increase in PMI with Asian stocks and the Australian dollar reversing earlier losses, the offshore yuan perking up and oil rallying.&nbsp;

Julian Evans-Pritchard, the head of China Economics at Capital Economics, said the high PMI readings partly reflected the Chinese economy's weak starting point coming into this year and were likely to drop back before long as the pace of recovery slowed. "We had already been expecting a rapid near-term rebound, but the latest data suggest that even our above-consensus forecasts for growth of 5.5% this year may prove too conservative," Pritchard said, Reuters reported.&nbsp;

Meanwhile, Zhou Hao, an economist at Guotai Junan International, said the PMI readings provided a positive note for the upcoming National People's Congress. "We expect the government to roll out further supportive policies to cement the economic recovery," Hao added.&nbsp;

In 2022, the Chinese economy recorded one of its worst years in nearly half a century due to the strict Covid restrictions and subsequent widespread infections. The PMI on Wednesday showed that new export orders rose for the first time in nearly two years.&nbsp;

On Friday, the country's central bank said that the domestic economy was expected to generally rebound this year, although the external environment remained ''severe and complex."

(With inputs from agencies) 
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China's manufacturing activity expanded at the fastest pace in over a decade in February, smashing expectations as production zoomed after the lifting of Covid curbs.

China's manufacturing activity expanded at the fastest pace in over a decade in February, smashing expectations as production zoomed after the lifting of Covid curbs. On Wednesday (March 1), the country's official manufacturing purchasing managers' index (PMI) climbed to 52.6 in February compared to 50.1 in January, the news agency Reuters reported. The PMI far exceeded an analyst forecast of 50.5 and was the highest reading since April 2012. Global markets cheered the increase in PMI with Asian stocks and the Australian dollar reversing earlier losses, the offshore yuan perking up and oil rallying. Julian Evans-Pritchard, the head of China Economics at Capital Economics, said the high PMI readings partly reflected the Chinese economy's weak starting point coming into this year and were likely to drop back before long as the pace of recovery slowed. "We had already been expecting a rapid near-term rebound, but the latest data suggest that even our above-consensus forecasts for growth of 5.5% this year may prove too conservative," Pritchard said, Reuters reported. Meanwhile, Zhou Hao, an economist at Guotai Junan International, said the PMI readings provided a positive note for the upcoming National People's Congress. "We expect the government to roll out further supportive policies to cement the economic recovery," Hao added. In 2022, the Chinese economy recorded one of its worst years in nearly half a century due to the strict Covid restrictions and subsequent widespread infections. The PMI on Wednesday showed that new export orders rose for the first time in nearly two years. On Friday, the country's central bank said that the domestic economy was expected to generally rebound this year, although the external environment remained ''severe and complex." (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

China's February manufacturing activity sees fastest growth in over a decade

China's great wall of debt has left authorities banging their heads against it. The country's overall debt has soared to $51.9 trillion. Chinese cities are struggling to pay bills. Molly Gambhir reports.

Gravitas: Chinese cities are struggling to pay bills

China's economic activity saw a growth in January and its factory activity expanded after four months of contraction, official data showed Tuesday. The economy has witnessed a rebound following the relaxation of strict Covid-19 curbs. The country went through a massive wave of COVID-19 infections that passed through faster than expected.&nbsp;

The official manufacturing purchasing managers' index (PMI) rose to 50.1 this month, from 47.0 in December, according to data from the National Bureau of Statistics (NBS). The PMI&nbsp;is a key gauge of factory output in the world's second-largest economy.

Also Read |&nbsp;<a href="https://www.wionews.com/business-economy/imf-lifts-2023-growth-forecast-in-world-economic-outlook-report-india-remains-a-bright-spot-557448">IMF lifts 2023 growth forecast in World Economic Outlook report</a>

Domestic orders and consumption led to the output seeing a rise, as the first broad data showed how quickly China is recovering from the Covid wave after reopening. However, analysts warned that the economy faced persistent weakness in external demand.

A rebound in non-manufacturing activity was more decisive than the economists had expected. It was helped by a seasonal surge in spending for the Lunar New Year holiday. The non-manufacturing PMI, which covers the services and construction sector, stood at 54.4 in January, up from 41.6 in December. &nbsp;

Beijing's economy saw just a three per cent growth last year, its slowest pace in four decades excluding pandemic-hit 2020. Strict Covid curbs and a crisis in the property market hampered growth immensely.

Rising interest rates have put pressure on foreign economies, affecting the demand for China's exports, which last month were 9.9 per cent lower than a year earlier.

(With inputs from agencies)

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China's economic activity saw a growth in January and its factory activity expanded after four months of contraction, official data showed Tuesday. The economy has witnessed a rebound following the relaxation of strict Covid-19 curbs.

China's economic activity saw a growth in January and its factory activity expanded after four months of contraction, official data showed Tuesday. The economy has witnessed a rebound following the relaxation of strict Covid-19 curbs. The country went through a massive wave of COVID-19 infections that passed through faster than expected. The official manufacturing purchasing managers' index (PMI) rose to 50.1 this month, from 47.0 in December, according to data from the National Bureau of Statistics (NBS). The PMI is a key gauge of factory output in the world's second-largest economy. Also Read | IMF lifts 2023 growth forecast in World Economic Outlook report Domestic orders and consumption led to the output seeing a rise, as the first broad data showed how quickly China is recovering from the Covid wave after reopening. However, analysts warned that the economy faced persistent weakness in external demand. A rebound in non-manufacturing activity was more decisive than the economists had expected. It was helped by a seasonal surge in spending for the Lunar New Year holiday. The non-manufacturing PMI, which covers the services and construction sector, stood at 54.4 in January, up from 41.6 in December. Beijing's economy saw just a three per cent growth last year, its slowest pace in four decades excluding pandemic-hit 2020. Strict Covid curbs and a crisis in the property market hampered growth immensely. Rising interest rates have put pressure on foreign economies, affecting the demand for China's exports, which last month were 9.9 per cent lower than a year earlier. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

China's economy saw an upsurge in January, official PMI shows

China is getting ready to greet the Year of the Rabbit, as the Year of the Tiger ends on January 21. This celestial change of guard&nbsp;may be a fitting metaphor for the changes that have been happening on the ground as well.

In October, when Xi Jinping was elected as the party head for an unprecedented third term, the mood in the Chinese Communist Party (CCP) seemed to be one of complete control of the situation. In his report to the party Congress, Xi hailed the implementation of the Zero Covid policy, saying it had “achieved significant positive results”.

When Xi unveiled the Standing Committee of the CCP politburo, the group which is to steer China in the coming years and is packed with his loyalists, it was seen as a complete triumph for the strongman, but very few foresaw a twist in the tail, as the Year of the Tiger drew to a close.

An organic countrywide protest against the Covid restrictions in November took even seasoned China watchers by surprise, as it was virtually unheard of in China. The spread of the Omicron variant of the Covid virus saw China’s lockdown mechanism failing to arrest the number of infections, and soon it all became chaotic as Beijing suddenly pulled the plug on its Zero Covid policy, which was till then seen as Xi’s signature policy.

Also Read |&nbsp;<a href="https://www.wionews.com/world/chinas-population-falls-to-a-60-year-low-demographers-predict-nation-will-get-old-before-it-gets-rich-553315">China's population falls to a 60 year low</a>

Overnight, official statements changed and the infections were characterised as mild illness and testing centres that had been in place in almost every city were dismantled. Armies of people in hazmat suits vanished overnight. It took almost three weeks before Xi himself commented on the new changed policy, even as authorities at the local level grappled with the new situation. The country has entered “a new phase of Covid response,” he told the nation on January 18.

The sudden lifting of all restrictions left Chinese hospitals swamped with patients as those infected could not even find a testing centre and had to rely on the nearest health facilities. As the vaccination rate among those aged over 80 was less than 60 percent, even Chinese officials were worried that over a million deaths would be caused by Covid by April. Officials then suspended reports on daily infection numbers, which prompted the World Health Organization (WHO) to plead for more transparency and valid data on the disease situation.

The relentless pursuit of the Zero Covid policy also caused some serious setbacks to the Chinese economy. From a position of projected rise as the foremost economy overtaking the United States by 2030, the gap between the two top economies widened further as the Chinese economy stalled over the last three years. The Japan Centre for Economic Research said last month that China's nominal GDP is unlikely to surpass the US in the next few decades due to Beijing's strict adherence to its Zero Covid policy and other related headwinds.

Also Read |&nbsp;<a href="https://www.wionews.com/world/chinas-regional-governments-spent-billions-on-covid-prevention-and-control-a-budget-report-reveals-553403">China's regional governments spent billions on COVID prevention and control, a budget report reveals</a>

It was not just the Covid policy that underwent changes. Soon, other policies that bore Xi's signature were also getting tweaked, like his crackdown on tech giants. China's video games regulator started granting licenses to new games, which had been on hold for months, while the ride-hailing app Didi was allowed to resume new registrations. Curbs on real estate funding are being eased, and Beijing is now reportedly working on a 450 billion yuan plan to prop up the troubled sector.

Xi has touted common prosperity as a cornerstone of his government policies, and tech giants like Alibaba announced a 100 billion dollar investment to make his dream of the society sharing wealth more equitably come true. After Beijing started changing tack on its key policies, the state media also seems to have lost its penchant for trumpeting the common prosperity goal.

On the global stage, China seems to be shedding the wolf warrior diplomacy and adopting a more accommodative tone. While signaling a willingness to talk with the US on issues like climate change and global trade, Beijing has also indicated it would soon lift some of the unofficial trade bans imposed on Australian goods.

But it is foolhardy to assume that Beijing is making a U-turn in all key policies it has been pursuing until recently. Its crackdown on November protesters continues, according to Chinese social media posts, while the CCP continues to choke Hong Kong, depriving it of most of the autonomy the global financial centre had enjoyed. On the Indian border, intrusions into Indian areas continue, while its military posturing over Taiwan airspace goes on unabated.

The opaque political system of the Chinese Communist Party seldom lets the outside world know what is happening in its corridors of power, and it may be decades before any solid evidence emerges about what prompted the current changes in Chinese policies. Even some of the seasoned China watchers are now left scratching their heads about the rapid changes being rolled out by Beijing. All one can be sure of right now is that the tiger has given way to the rabbit, at least on the Chinese zodiac calendar.

(Disclaimer: The views of the writer do not represent the views of WION or ZMCL. Nor does WION or ZMCL endorse the views of the writer.) &nbsp;&nbsp;

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China is getting ready to greet the Year of the Rabbit, as the Year of the Tiger ends on January 21. This celestial change of guard may be a fitting metaphor for the changes that have been happening on the ground as well.

China is getting ready to greet the Year of the Rabbit, as the Year of the Tiger ends on January 21. This celestial change of guard may be a fitting metaphor for the changes that have been happening on the ground as well. In October, when Xi Jinping was elected as the party head for an unprecedented third term, the mood in the Chinese Communist Party (CCP) seemed to be one of complete control of the situation. In his report to the party Congress, Xi hailed the implementation of the Zero Covid policy, saying it had “achieved significant positive results”. When Xi unveiled the Standing Committee of the CCP politburo, the group which is to steer China in the coming years and is packed with his loyalists, it was seen as a complete triumph for the strongman, but very few foresaw a twist in the tail, as the Year of the Tiger drew to a close. An organic countrywide protest against the Covid restrictions in November took even seasoned China watchers by surprise, as it was virtually unheard of in China. The spread of the Omicron variant of the Covid virus saw China’s lockdown mechanism failing to arrest the number of infections, and soon it all became chaotic as Beijing suddenly pulled the plug on its Zero Covid policy, which was till then seen as Xi’s signature policy. Also Read | China's population falls to a 60 year low Overnight, official statements changed and the infections were characterised as mild illness and testing centres that had been in place in almost every city were dismantled. Armies of people in hazmat suits vanished overnight. It took almost three weeks before Xi himself commented on the new changed policy, even as authorities at the local level grappled with the new situation. The country has entered “a new phase of Covid response,” he told the nation on January 18. The sudden lifting of all restrictions left Chinese hospitals swamped with patients as those infected could not even find a testing centre and had to rely on the nearest health facilities. As the vaccination rate among those aged over 80 was less than 60 percent, even Chinese officials were worried that over a million deaths would be caused by Covid by April. Officials then suspended reports on daily infection numbers, which prompted the World Health Organization (WHO) to plead for more transparency and valid data on the disease situation. The relentless pursuit of the Zero Covid policy also caused some serious setbacks to the Chinese economy. From a position of projected rise as the foremost economy overtaking the United States by 2030, the gap between the two top economies widened further as the Chinese economy stalled over the last three years. The Japan Centre for Economic Research said last month that China's nominal GDP is unlikely to surpass the US in the next few decades due to Beijing's strict adherence to its Zero Covid policy and other related headwinds. Also Read | China's regional governments spent billions on COVID prevention and control, a budget report reveals It was not just the Covid policy that underwent changes. Soon, other policies that bore Xi's signature were also getting tweaked, like his crackdown on tech giants. China's video games regulator started granting licenses to new games, which had been on hold for months, while the ride-hailing app Didi was allowed to resume new registrations. Curbs on real estate funding are being eased, and Beijing is now reportedly working on a 450 billion yuan plan to prop up the troubled sector. Xi has touted common prosperity as a cornerstone of his government policies, and tech giants like Alibaba announced a 100 billion dollar investment to make his dream of the society sharing wealth more equitably come true. After Beijing started changing tack on its key policies, the state media also seems to have lost its penchant for trumpeting the common prosperity goal. On the global stage, China seems to be shedding the wolf warrior diplomacy and adopting a more accommodative tone. While signaling a willingness to talk with the US on issues like climate change and global trade, Beijing has also indicated it would soon lift some of the unofficial trade bans imposed on Australian goods. But it is foolhardy to assume that Beijing is making a U-turn in all key policies it has been pursuing until recently. Its crackdown on November protesters continues, according to Chinese social media posts, while the CCP continues to choke Hong Kong, depriving it of most of the autonomy the global financial centre had enjoyed. On the Indian border, intrusions into Indian areas continue, while its military posturing over Taiwan airspace goes on unabated. The opaque political system of the Chinese Communist Party seldom lets the outside world know what is happening in its corridors of power, and it may be decades before any solid evidence emerges about what prompted the current changes in Chinese policies. Even some of the seasoned China watchers are now left scratching their heads about the rapid changes being rolled out by Beijing. All one can be sure of right now is that the tiger has given way to the rabbit, at least on the Chinese zodiac calendar. (Disclaimer: The views of the writer do not represent the views of WION or ZMCL. Nor does WION or ZMCL endorse the views of the writer.) 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In China, the tiger gives way to a rabbit

Many of China's regional governments have revealed the enormous expenses incurred in order to enforce the country's zero-Covid policy. The whopping amounts corroborate state media reports that suggested that the huge costs were a primary reason for Beijing to abruptly pull the plug on its Covid policy.

A report published by the state-owned Xinhua News Agency on January 8, the day when Beijing lifted travel restrictions, talked about the main reasons behind the sudden change on the government's Covid policy.

“It is difficult to eliminate the coronavirus, and the social cost and price of Covid prevention and control are rising,” it said.

A provincial budget report released on Friday revealed that Guangdong, the country’s top province by economic output, has spent a total of 146.8 billion yuan ($22 billion) on preventive measures since the beginning of 2020. It was mostly spent on&nbsp;testing, vaccination and made up for other policy enforcement-related expenses.

Also Read | <a href="https://www.wionews.com/business-economy/chinas-economy-grows-3-in-2022-hit-by-covid-restrictions-553375">Hit by Covid restrictions, China's economy grew 3% in 2022</a>

During the three years, Covid-related spending saw a surge of about 50 per cent each year. It hit a peak of 71.1 billion yuan ($10.6 billion) in 2022, and is equivalent to 35 per cent of the province’s spending on research and development.&nbsp;

The figure even exceeds the amount the country had spent on establishing its national chip fund, a hallmark initiative of President Xi Jinping’s administration. Set up on 2014, China Integrated Circuit Industry Investment Fund had an initial investment of $138.7 billion yuan ($21 billion.)&nbsp;

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Notably, the local governments of the county started convening for annual legislative sessions last week. They will be talking about their policy goals for the new year at the meeting. Most of them are facing a shortage of cash due to the COVID-19 curbs that put immense pressure on the entire economy.&nbsp;

The meeting will culminate in the national parliamentary session in March where Xi will mention the nation’s GDP growth target, as well as its budget plans and other goals.

(With inputs from agencies)

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Many of China's regional governments have revealed the enormous expenses incurred in order to enforce the country's zero-Covid policy. The whopping amounts corroborate state media reports that suggested that the huge costs were a primary reason for Beijing to abruptly pull the plug on its Covid policy.

Many of China's regional governments have revealed the enormous expenses incurred in order to enforce the country's zero-Covid policy. The whopping amounts corroborate state media reports that suggested that the huge costs were a primary reason for Beijing to abruptly pull the plug on its Covid policy. A report published by the state-owned Xinhua News Agency on January 8, the day when Beijing lifted travel restrictions, talked about the main reasons behind the sudden change on the government's Covid policy. “It is difficult to eliminate the coronavirus, and the social cost and price of Covid prevention and control are rising,” it said. A provincial budget report released on Friday revealed that Guangdong, the country’s top province by economic output, has spent a total of 146.8 billion yuan ($22 billion) on preventive measures since the beginning of 2020. It was mostly spent on testing, vaccination and made up for other policy enforcement-related expenses. Also Read | Hit by Covid restrictions, China's economy grew 3% in 2022 During the three years, Covid-related spending saw a surge of about 50 per cent each year. It hit a peak of 71.1 billion yuan ($10.6 billion) in 2022, and is equivalent to 35 per cent of the province’s spending on research and development. The figure even exceeds the amount the country had spent on establishing its national chip fund, a hallmark initiative of President Xi Jinping’s administration. Set up on 2014, China Integrated Circuit Industry Investment Fund had an initial investment of $138.7 billion yuan ($21 billion.) × Notably, the local governments of the county started convening for annual legislative sessions last week. They will be talking about their policy goals for the new year at the meeting. Most of them are facing a shortage of cash due to the COVID-19 curbs that put immense pressure on the entire economy. The meeting will culminate in the national parliamentary session in March where Xi will mention the nation’s GDP growth target, as well as its budget plans and other goals. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

China's regional governments spent billions on COVID prevention and control, a budget report reveals

For the straight 16th month, the property market in China saw a slump in home prices, as widespread covid outbreaks “complicated” efforts to rescue the sector that has for months witnessed a steady fall.&nbsp;

As per a Bloomberg report, 70 cities across China saw a 0.25 per cent decline in the prices of new homes. As per National Bureau of Statistics figures, November also saw a similar slump. 2022 as a whole saw prices drop by 2.3 per cent. This figure excludes state-subsidised housing.

Watch |&nbsp;Gravitas: 50 million homes are empty in China

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For the pre-owned housing market, the slump was worse at 0.48 per cent in December. In November, the prices fell by 0.44 per cent.

Also read |&nbsp;<a href="https://www.wionews.com/economy/build-pause-demolish-repeat-china-to-demolish-buildings-that-could-accommodate-75-million-people-515567">'Build, pause, demolish, repeat': China to demolish buildings that could accommodate 75 million people</a>

The decline, as per the report, comes even as Beijing introduced a sweeping plan to rescue the housing industry and pledged financial aid for cash-strapped developers.

Also read |&nbsp; <a href="https://www.wionews.com/world/zero-covid-a-crumbling-real-estate-market-and-more-chinese-economy-and-the-challenges-it-faces-522534">Zero-Covid, a crumbling real estate market and more: Chinese economy and the challenges it faces</a>

Additionally, the country has also taken steps to stimulate homebuyer demand. However, following the sudden scrapping of the nation’s stringent zero-Covid measures, the large-scale COVID-19 outbreaks, and high numbers of cases, have severely affected confidence among businesses and customers.

The Bloomberg report suggests that lowering borrowing costs for homebuyers may help boost demand, adding that “it’s unclear whether such steps are enough to revive a market that has seen sales drop since mid-2021. “ A recent China Index Holdings survey of prospective buyers in 100 major cities shows that prices will continue to fall in 2023.

(With inputs from agencies)

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For the straight 16th month, the property market in China saw a slump in home prices, as widespread covid outbreaks “complicated” efforts to rescue the sector that has for months witnessed a steady fall.

For the straight 16th month, the property market in China saw a slump in home prices, as widespread covid outbreaks “complicated” efforts to rescue the sector that has for months witnessed a steady fall. As per a Bloomberg report, 70 cities across China saw a 0.25 per cent decline in the prices of new homes. As per National Bureau of Statistics figures, November also saw a similar slump. 2022 as a whole saw prices drop by 2.3 per cent. This figure excludes state-subsidised housing. Watch | Gravitas: 50 million homes are empty in China For the pre-owned housing market, the slump was worse at 0.48 per cent in December. In November, the prices fell by 0.44 per cent. Also read | 'Build, pause, demolish, repeat': China to demolish buildings that could accommodate 75 million people The decline, as per the report, comes even as Beijing introduced a sweeping plan to rescue the housing industry and pledged financial aid for cash-strapped developers. Also read | Zero-Covid, a crumbling real estate market and more: Chinese economy and the challenges it faces Additionally, the country has also taken steps to stimulate homebuyer demand. However, following the sudden scrapping of the nation’s stringent zero-Covid measures, the large-scale COVID-19 outbreaks, and high numbers of cases, have severely affected confidence among businesses and customers. The Bloomberg report suggests that lowering borrowing costs for homebuyers may help boost demand, adding that “it’s unclear whether such steps are enough to revive a market that has seen sales drop since mid-2021. “ A recent China Index Holdings survey of prospective buyers in 100 major cities shows that prices will continue to fall in 2023. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

China's housing market witnesses a slump for the 16th month

China's property sector shrank further in November, with falls in prices, sales and investment, partly as COVID-19 restrictions hit demand. Watch this video to know more.

World Business Watch: China property slumps further in November

China's business confidence fell to its lowest since January 2013, a survey by World Economics showed on Monday, reflecting the impact of surging COVID-19 cases on economic activity.

World Business Watch: Chinese business confidence falls to lowest in almost a decade

China's exports and imports declined&nbsp;at their steepest pace in the last 18 months till November, as slow global and domestic demand, production disruptions due to Covid-related restrictions and real estate slump piled pressure on the world's second-biggest economy.&nbsp;

Exports contracted 8.7 per cent&nbsp;in November from a year earlier, a sharper fall from a 0.3 per cent&nbsp;loss in October and marked the worst performance since February 2020, official data showed on Wednesday. They were well below analysts' expectations of&nbsp;a 3.5 per cent&nbsp;decline.

The reports of declines coincided with the crucial decision by Beijing that rolled back strict Covid rules on Wednesday and allowed Covid cases with mild symptoms to quarantine at home.

ALSO READ -&nbsp;<a href="https://www.wionews.com/world/chinese-economy-continues-to-struggle-amid-erratic-policies-and-decisions-521091">Chinese economy continues to struggle amid 'erratic' policies and decisions</a>

The outbound shipments have been losing steam since August as surging inflation, sweeping interest rate increases across many countries and the Ukraine crisis have pushed the global economy to the brink of recession.

WATCH -&nbsp;<a href="https://www.wionews.com/videos/gravitas-how-zero-covid-ravaged-chinese-economy-483939">Gravitas: How Zero Covid ravaged Chinese economy</a>

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Exports are likely to shrink further over coming quarters, Julian Evans-Pritchard, senior China Economist at Capital Economics, said in a note.

"Outbound shipments will receive a limited boost from the easing of (China's) virus restrictions, which are no longer a major constraint on the ability of manufacturers to meet orders," he said.

"Of much greater consequence will be the downturn in global demand for Chinese goods due to the reversal in pandemic-era demand and the coming global recession."

Responding to the broadening pressure on China's economy, state media reported on Wednesday that a high-level meeting of the ruling Communist Party held on the previous day had emphasised the government's focus in 2023 will be on stabilising growth, promoting domestic demand and opening up to the outside world.

"The Politburo meeting held yesterday points to domestic demand as the major driver for growth for the next year, and the fiscal policy will remain proactive to support demand," said Hao Zhou, chief economist at Guotai Junan International.

Almost three years of pandemic controls have exacted a heavy economic toll and caused widespread frustration and fatigue in China.

The widespread COVID curbs hurt importers too. Inbound shipments were down sharply by 10.6 per cent from a 0.7 per cent&nbsp;drop in October, weaker than a forecast 6.0 per cent&nbsp;decline. The downturn was the worst since May 2020, partly also reflecting a high year-earlier base for comparison.

China's economy grew just 3 per cent&nbsp;in the first three quarters of this year, well below the annual target of around 5.5 per cent. Full-year growth is widely expected by analysts to be just over 3 per cent.

Zhiwei Zhang, chief economist at Pinpoint Asset Management, cautioned about China's "bumpy reopening" process. 
"As global demand weakens in 2023, China will have to rely more on domestic demand," Zhang told Reuters.

(With inputs from agencies)

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China's exports and imports declined at their steepest pace in the last 18 months till November, as slow global and domestic demand, production disruptions due to Covid-related restrictions and real estate slump piled pressure on the world's second-biggest economy.

China's exports and imports declined at their steepest pace in the last 18 months till November, as slow global and domestic demand, production disruptions due to Covid-related restrictions and real estate slump piled pressure on the world's second-biggest economy. Exports contracted 8.7 per cent in November from a year earlier, a sharper fall from a 0.3 per cent loss in October and marked the worst performance since February 2020, official data showed on Wednesday. They were well below analysts' expectations of a 3.5 per cent decline. The reports of declines coincided with the crucial decision by Beijing that rolled back strict Covid rules on Wednesday and allowed Covid cases with mild symptoms to quarantine at home. ALSO READ - Chinese economy continues to struggle amid 'erratic' policies and decisions The outbound shipments have been losing steam since August as surging inflation, sweeping interest rate increases across many countries and the Ukraine crisis have pushed the global economy to the brink of recession. WATCH - Gravitas: How Zero Covid ravaged Chinese economy × Exports are likely to shrink further over coming quarters, Julian Evans-Pritchard, senior China Economist at Capital Economics, said in a note. "Outbound shipments will receive a limited boost from the easing of (China's) virus restrictions, which are no longer a major constraint on the ability of manufacturers to meet orders," he said. "Of much greater consequence will be the downturn in global demand for Chinese goods due to the reversal in pandemic-era demand and the coming global recession." Responding to the broadening pressure on China's economy, state media reported on Wednesday that a high-level meeting of the ruling Communist Party held on the previous day had emphasised the government's focus in 2023 will be on stabilising growth, promoting domestic demand and opening up to the outside world. "The Politburo meeting held yesterday points to domestic demand as the major driver for growth for the next year, and the fiscal policy will remain proactive to support demand," said Hao Zhou, chief economist at Guotai Junan International. Almost three years of pandemic controls have exacted a heavy economic toll and caused widespread frustration and fatigue in China. The widespread COVID curbs hurt importers too. Inbound shipments were down sharply by 10.6 per cent from a 0.7 per cent drop in October, weaker than a forecast 6.0 per cent decline. The downturn was the worst since May 2020, partly also reflecting a high year-earlier base for comparison. China's economy grew just 3 per cent in the first three quarters of this year, well below the annual target of around 5.5 per cent. Full-year growth is widely expected by analysts to be just over 3 per cent. Zhiwei Zhang, chief economist at Pinpoint Asset Management, cautioned about China's "bumpy reopening" process. "As global demand weakens in 2023, China will have to rely more on domestic demand," Zhang told Reuters. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

China's imports, exports register steep decline amid Covid restrictions, slow demand

The US services industry activity has unexpectedly picked up last month. Economy continues to create jobs last month and wage growth is accelerating.

World Business Watch | US services sector activity unexpectedly accelerates in November

A private-sector business survey has shown that China's services activity shrank to six-month lows in November. This happened amid widening Covid curbs that directly impacted demand and operations. China's economy has been hit extensively due to the pandemic and the zero-Covid policy and this reports adds to its agony.

The Caixin/S&amp;P Global services purchasing managers' index (PMI) fell to 46.7 from 48.4, marking the third monthly contraction in a row. The 50-point index mark separates growth from contraction on a monthly basis.

Another larger official survey that came out on Wednesday had showed that services activity fell to seven-month lows.

Also Read |&nbsp;<a href="https://www.wionews.com/world/china-heading-towards-covid-19-disaster-experts-predict-539887">China may face COVID-19 disaster if harsh lockdowns lifted, experts predict</a>

China has been witnessing a record number of Covid cases for the past few weeks. Analysts at Nomura estimated that areas in lockdowns accounted for about a quarter of China's gross domestic product (GDP) by the end of the month. This meant a loss to domestic consumption and&nbsp;supply chains being disrupted.

"Since October, the impact of Covid outbreaks has taken a heavy toll on the economy, and the challenge of how to balance Covid controls and economic growth has once again become a core issue," Wang Zhe, senior economist at Caixin Insight Group, told Reuters.

"The market is in urgent need of policies to promote employment and stabilize domestic demand. Beijing should further coordinate fiscal and monetary policies to expand domestic demand and boost incomes of the poorer parts of the population," Wang added.

Companies in the Caixin/S&amp;P survey reported the strongest falls in output and new work for six months. They have been laying off staff as confidence in the outlook for the next 12 months fell to an eight-month low. The rate of job losses was the quickest seen since the survey began in November 2005.&nbsp;

However, relaxation of international travel rules enabled the export business to return to growth from contraction in October. Companies also continued to raise their prices, while input cost inflation softened.

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&nbsp;

Beijing has loosened certain virus policies on testing requirements and quarantine rules following widespread protests.&nbsp;

Economists and analysts believe that Beijing might abandon its zero-Covid approach by the annual parliamentary meeting in spring next year.

Caixin/S&amp;P's composite PMI, which includes both manufacturing and services activity, fell to 47.0 in November from 48.3 the previous month, driven by falls in both manufacturing and service sector output.

The Caixin PMI is compiled by S&amp;P Global from responses to questions sent to purchasing managers in China.

(With inputs from agencies)

&nbsp;

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A private-sector business survey has shown that China's services activity shrank to six-month lows in November. This happened amid widening Covid curbs that directly impacted demand and operations.

A private-sector business survey has shown that China's services activity shrank to six-month lows in November. This happened amid widening Covid curbs that directly impacted demand and operations. China's economy has been hit extensively due to the pandemic and the zero-Covid policy and this reports adds to its agony. The Caixin/S&P Global services purchasing managers' index (PMI) fell to 46.7 from 48.4, marking the third monthly contraction in a row. The 50-point index mark separates growth from contraction on a monthly basis. Another larger official survey that came out on Wednesday had showed that services activity fell to seven-month lows. Also Read | China may face COVID-19 disaster if harsh lockdowns lifted, experts predict China has been witnessing a record number of Covid cases for the past few weeks. Analysts at Nomura estimated that areas in lockdowns accounted for about a quarter of China's gross domestic product (GDP) by the end of the month. This meant a loss to domestic consumption and supply chains being disrupted. "Since October, the impact of Covid outbreaks has taken a heavy toll on the economy, and the challenge of how to balance Covid controls and economic growth has once again become a core issue," Wang Zhe, senior economist at Caixin Insight Group, told Reuters. "The market is in urgent need of policies to promote employment and stabilize domestic demand. Beijing should further coordinate fiscal and monetary policies to expand domestic demand and boost incomes of the poorer parts of the population," Wang added. Companies in the Caixin/S&P survey reported the strongest falls in output and new work for six months. They have been laying off staff as confidence in the outlook for the next 12 months fell to an eight-month low. The rate of job losses was the quickest seen since the survey began in November 2005. However, relaxation of international travel rules enabled the export business to return to growth from contraction in October. Companies also continued to raise their prices, while input cost inflation softened. × Beijing has loosened certain virus policies on testing requirements and quarantine rules following widespread protests. Economists and analysts believe that Beijing might abandon its zero-Covid approach by the annual parliamentary meeting in spring next year. Caixin/S&P's composite PMI, which includes both manufacturing and services activity, fell to 47.0 in November from 48.3 the previous month, driven by falls in both manufacturing and service sector output. The Caixin PMI is compiled by S&P Global from responses to questions sent to purchasing managers in China. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

China services activity shrank to six-month lows in November: Caixin PMI

The Chinese economy is suffering increasing damage from tightened virus controls as Covid infections are spreading in almost every province. Watch full video to know more.

China's economic activity falls as Covid-19 cases surge to record

China's factory activity shrank for a second straight month in November, official data showed Wednesday, as large swathes of the country were hit by COVID-19 lockdowns and transport disruptions.

The Purchasing Managers' Index (PMI) - a key gauge of manufacturing in the world's second-biggest economy came in at 48.0, down from October's 49.2 and well below the 50-point mark separating growth from contraction, according to data from the National Bureau of Statistics (NBS).

China is the last major economy welded to a zero-Covid strategy of eliminating outbreaks with strict quarantines and mass testing even as infections reached record highs this month, dragging down demand and business confidence.

"In November, impacted by multiple factors including the wide and frequent spread of domestic outbreaks, and the international environment becoming more complex and severe, China's purchasing managers' index fell," NBS senior statistician Zhao Qinghe said in a statement.

November's figure was lower than the 49.0 reading predicted by Bloomberg analysts.

The manufacturing PMI has been in contraction territory for all but four months of the year so far, as a summer of heat waves was bookended by Covid lockdowns in major cities during the spring and autumn.

Zhao said domestic outbreaks in November caused "production activity to slow down and product orders to fall", noting "increased fluctuation in market expectations".

Activity fell at businesses of all sizes during the month, with the PMI for small enterprises hit hardest at 45.6. 
The non-manufacturing PMI came in at 46.7 points in November, also reflecting a contraction in activity and down from 48.7 points in October.

Zhao said that for transport, accommodation, catering and entertainment in particular "the total industry business volume fell significantly", as "some regions saw a relatively large impact from the pandemic".

Chinese leaders have set an annual economic growth target of about 5.5 per cent, but many observers think the country will struggle to hit it, despite announcing a better-than-expected 3.9 per cent expansion in the third quarter.

<a href="https://www.wionews.com/videos/wion-fineprint-china-omits-mention-of-gdp-growth-goal-503357">WATCH |&nbsp;WION Fineprint: China omits mention of GDP growth goal</a>

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Meanwhile, rare nationwide protests have erupted among a population exhausted by almost three years of zero-Covid, while authorities have offered mixed messages on transitioning away from the strategy.

"The virus situation continues to cloud the economic outlook," Sheana Yue, China economist at Capital Economics said in a note on Wednesday.

"Most cities have taken to implementing localised lockdowns, similar to the ones we saw in April, which will continue to weigh heavily on services activity," Yue said.

She warned, "there is little upside that might offset the weakness," with a global downturn putting pressure on export-focused businesses in China.

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China's factory activity shrank for a second straight month in November, official data showed Wednesday, as large swathes of the country were hit by COVID-19 lockdowns and transport disruptions.

China's factory activity shrank for a second straight month in November, official data showed Wednesday, as large swathes of the country were hit by COVID-19 lockdowns and transport disruptions. The Purchasing Managers' Index (PMI) - a key gauge of manufacturing in the world's second-biggest economy came in at 48.0, down from October's 49.2 and well below the 50-point mark separating growth from contraction, according to data from the National Bureau of Statistics (NBS). China is the last major economy welded to a zero-Covid strategy of eliminating outbreaks with strict quarantines and mass testing even as infections reached record highs this month, dragging down demand and business confidence. "In November, impacted by multiple factors including the wide and frequent spread of domestic outbreaks, and the international environment becoming more complex and severe, China's purchasing managers' index fell," NBS senior statistician Zhao Qinghe said in a statement. November's figure was lower than the 49.0 reading predicted by Bloomberg analysts. The manufacturing PMI has been in contraction territory for all but four months of the year so far, as a summer of heat waves was bookended by Covid lockdowns in major cities during the spring and autumn. Zhao said domestic outbreaks in November caused "production activity to slow down and product orders to fall", noting "increased fluctuation in market expectations". Activity fell at businesses of all sizes during the month, with the PMI for small enterprises hit hardest at 45.6. The non-manufacturing PMI came in at 46.7 points in November, also reflecting a contraction in activity and down from 48.7 points in October. Zhao said that for transport, accommodation, catering and entertainment in particular "the total industry business volume fell significantly", as "some regions saw a relatively large impact from the pandemic". Chinese leaders have set an annual economic growth target of about 5.5 per cent, but many observers think the country will struggle to hit it, despite announcing a better-than-expected 3.9 per cent expansion in the third quarter. WATCH | WION Fineprint: China omits mention of GDP growth goal × Meanwhile, rare nationwide protests have erupted among a population exhausted by almost three years of zero-Covid, while authorities have offered mixed messages on transitioning away from the strategy. "The virus situation continues to cloud the economic outlook," Sheana Yue, China economist at Capital Economics said in a note on Wednesday. "Most cities have taken to implementing localised lockdowns, similar to the ones we saw in April, which will continue to weigh heavily on services activity," Yue said. She warned, "there is little upside that might offset the weakness," with a global downturn putting pressure on export-focused businesses in China. WATCH WION LIVE HERE:

Amid Covid protests, China's factory activity slumps for second successive month

China is sharply falling into its own debt trap as the country's banks have sharply reduced lending to low-income countries under its flagship Belt and Road initiative after the crumbled economies of borrowing countries have left the Asian giant with huge piled up loans, a report has said.

The China Files: China's debt crisis is deepening

China has locked down parts of its Central Metropolis, this has confined some of the city's 13 million people to their homes for at least a week, this has once again bought China's zero-Covid policy back into focus and because of which China's economic growth still remains slow.

China: Challenges for Xi Jinping as economic growth remains slow

As China gears up for its party congress, President Xi Jinping is facing one of the worst headwinds for the Asian giant's economy. As the global economy faces the looming danger of recession, China is also slowing down. The nation narrowly avoided contraction in the April to June quarter. With figures for July- September quarter expected next week, it is predicted that Beijing's goal of a 5.5 per cent annual growth rate will remain unmet. Ahead of the Communist Party congress, officials too have downplayed the need to meet the target.

As per a BBC report, economists are not expecting any growth. While the nation's economy might have&nbsp;escaped the steep inflation plaguing the US and the UK, it is facing its own slew of problems. Here's how China's economy is in trouble:

1. A property market in crisis

China's property market, which accounts for one-third of the nation's GDP, is facing its biggest crisis, with the situation going from bad to worse. A faltering, debt-ridden real estate market has led to "ghost cities" with housing that could accommodate more than 75 million people sitting empty.

To revive the slumping market, Beijing as per reports has undertaken a "build, pause, demolish, repeat" policy.

As per a Telegraph report, in recent years approximately three billion square metres of housing in the world's second-largest economy have been paused and/or demolished.

Also read |&nbsp;<a href="https://www.wionews.com/economy/build-pause-demolish-repeat-china-to-demolish-buildings-that-could-accommodate-75-million-people-515567">'Build, pause, demolish, repeat': China to demolish buildings that could accommodate 75 million people</a>

2. Zero-Covid: A China-specific economic slowdown

When the globe was hit by the COVID-19 pandemic, governments around the world took steps to protect their citizens and prevent fatalities. China's "Zero-Covid" strategy to combat the coronavirus has left its economy crippled.

Stringent lockdowns in several cities including the manufacturing hubs like Shenzen and Tianjin have had an incredibly detrimental effect.&nbsp;

As per Reuters, while exports remained a major driver this year, China's Assistant Commerce Minister Li Fei has warned that the nation's foreign trade faces unfavourable factors like a weakening external demand.

Snap lockdowns have further dampened consumer enthusiasm and business confidence.

Watch |&nbsp;Gravitas: 50 million homes are empty in China

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3. What the government is(n't) doing:

Even after 2.5 years of Zero-Covid, authorities have done little to ease covid curbs.&nbsp;

While Beijing announced a 1 trillion yuan ($203 billion) plan to boost small businesses, infrastructure and the real estate market in August, as per BBC, so much more could be done.&nbsp;

Investment in infrastructure, a loosening of credit requirements for homebuyers, builders, and local government, as well as tax cuts for households, are some things the administration can do.

4. The dismal state of the job market:

A slowing economy owing to the stringent Covid curbs, a huge number of graduates and a dearth of prospects are plaguing China's job market.

The nation's slowing economy has left millions of youngsters facing fierce competition for an ever-slimming raft of jobs and facing an increasingly uncertain future, reports AFP.

As per official data in July, one in five young people in Chinese cities was out of work. This is more than three times the national average and the highest recorded in four years, since January 2018.

Also read |&nbsp;<a href="https://www.wionews.com/world/chinas-xi-all-set-to-usurp-mao-era-chairman-post-for-self-at-upcoming-party-congress-522252" hreflang="en">China’s Xi all set to usurp Mao-era ‘Chairman’ post at upcoming party congress: Report</a>

5. Climate woes:

Climate change too is negatively affecting China's economy. In August, the nation's central belt faced a severe heatwave, followed by a drought. High demand for air conditioning caused the electricity grid to be overwhelmed, impacting China's industry.

6. Falling investment:

With the Covid curbs already lasting 2.5 years, foreign businesses in China have been hit. In September, the European Union's Chamber of Commerce warned that the nation's Zero-covid policy is crippling European businesses.

It reported that the "massive uncertainty" surrounding curbs have impacted 75 per cent of its member's operations. The situation has prompted nearly a quarter of European firms to consider a shift of current and future investments out of China added the Chamber. This is the highest percentage in the past decade.

Nearly 11 million graduates entered China's bleak job market this summer, with the economy growing at 0.4 per cent in the second quarter, the weakest in two years.

(With inputs from agencies)

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As China gears up for its party congress, President Xi Jinping is facing one of the worst headwinds for the Asian giant's economy. As the global economy faces the looming danger of recession, China is also slowing down.

As China gears up for its party congress, President Xi Jinping is facing one of the worst headwinds for the Asian giant's economy. As the global economy faces the looming danger of recession, China is also slowing down. The nation narrowly avoided contraction in the April to June quarter. With figures for July- September quarter expected next week, it is predicted that Beijing's goal of a 5.5 per cent annual growth rate will remain unmet. Ahead of the Communist Party congress, officials too have downplayed the need to meet the target. As per a BBC report, economists are not expecting any growth. While the nation's economy might have escaped the steep inflation plaguing the US and the UK, it is facing its own slew of problems. Here's how China's economy is in trouble: 1. A property market in crisis China's property market, which accounts for one-third of the nation's GDP, is facing its biggest crisis, with the situation going from bad to worse. A faltering, debt-ridden real estate market has led to "ghost cities" with housing that could accommodate more than 75 million people sitting empty. To revive the slumping market, Beijing as per reports has undertaken a "build, pause, demolish, repeat" policy. As per a Telegraph report, in recent years approximately three billion square metres of housing in the world's second-largest economy have been paused and/or demolished. Also read | 'Build, pause, demolish, repeat': China to demolish buildings that could accommodate 75 million people 2. Zero-Covid: A China-specific economic slowdown When the globe was hit by the COVID-19 pandemic, governments around the world took steps to protect their citizens and prevent fatalities. China's "Zero-Covid" strategy to combat the coronavirus has left its economy crippled. Stringent lockdowns in several cities including the manufacturing hubs like Shenzen and Tianjin have had an incredibly detrimental effect. As per Reuters, while exports remained a major driver this year, China's Assistant Commerce Minister Li Fei has warned that the nation's foreign trade faces unfavourable factors like a weakening external demand. Snap lockdowns have further dampened consumer enthusiasm and business confidence. Watch | Gravitas: 50 million homes are empty in China 3. What the government is(n't) doing: Even after 2.5 years of Zero-Covid, authorities have done little to ease covid curbs. While Beijing announced a 1 trillion yuan ($203 billion) plan to boost small businesses, infrastructure and the real estate market in August, as per BBC, so much more could be done. Investment in infrastructure, a loosening of credit requirements for homebuyers, builders, and local government, as well as tax cuts for households, are some things the administration can do. 4. The dismal state of the job market: A slowing economy owing to the stringent Covid curbs, a huge number of graduates and a dearth of prospects are plaguing China's job market. The nation's slowing economy has left millions of youngsters facing fierce competition for an ever-slimming raft of jobs and facing an increasingly uncertain future, reports AFP. As per official data in July, one in five young people in Chinese cities was out of work. This is more than three times the national average and the highest recorded in four years, since January 2018. Also read | China’s Xi all set to usurp Mao-era ‘Chairman’ post at upcoming party congress: Report 5. Climate woes: Climate change too is negatively affecting China's economy. In August, the nation's central belt faced a severe heatwave, followed by a drought. High demand for air conditioning caused the electricity grid to be overwhelmed, impacting China's industry. 6. Falling investment: With the Covid curbs already lasting 2.5 years, foreign businesses in China have been hit. In September, the European Union's Chamber of Commerce warned that the nation's Zero-covid policy is crippling European businesses. It reported that the "massive uncertainty" surrounding curbs have impacted 75 per cent of its member's operations. The situation has prompted nearly a quarter of European firms to consider a shift of current and future investments out of China added the Chamber. This is the highest percentage in the past decade. Nearly 11 million graduates entered China's bleak job market this summer, with the economy growing at 0.4 per cent in the second quarter, the weakest in two years. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Zero-Covid, a crumbling real estate market and more: Chinese economy and the challenges it faces

China's economy is slowing down, the official growth figures from July to September are expected soon and if the world's second largest economy contracts, it increases the chances of a global recession.

China's economic policy in trouble?: Zero-Covid policy holds danger for the country

As the overall costs of keeping nationwide coronavirus-curbing measures in place are also rising, the fiscal budget for most of China’s local-level governments is tight. People in Changshou district in the southwestern municipality&nbsp; of Chongqing, and Neijiang city in Sichuan province are being charged to stay in centralised quarantine facilities, a cost previously being borne by the government.

The cost is as high as 300 yuan (US$40) per day in Changshou, according to a notice posted on the government’s WeChat account on September 21. Spending on a week's stay becomes almost impossible for most people.&nbsp;

Also Read |&nbsp;<a href="https://www.wionews.com/world/the-truth-behind-china-coup-and-xi-jinping-being-under-house-arrest-did-social-media-cross-the-line-519805">The truth behind 'China coup' and Xi Jinping being 'under house arrest'</a>

Lack of finances has also disrupted public transport in many regions, such as Henan, Hunan and Guangdong. Experts see that financial problems at the local level are reflecting in almost every service and shows the local governments' inability to run basic services.

Between 2021 and 2025, roughly three trillion yuan (US$415 billion) worth of bonds sold by local government financing vehicles (LGFVs) will mature annually. The repayment pressure has become increasingly significant, according to analysts. LGFVs are a popular platform for the local governments in China for borrowing, but disclosure of the use of funds is often poor.

SCMP reported that on the evening of August 29, an LGFV in Gansu province made a last-minute dash to repay interest on a bond listed in the interbank market, after the Shanghai Clearing House announced earlier in the day that it had not received sufficient funds from the LGFV to meet its interest payment requirement. The delay in the interest payment immediately raised questions over the risks of a possible LGFV bond default in the listed market.

China’s growth is slowing and it is not expected to meet its annual target gross domestic product (GDP) of “around 5.5 per cent” this year.&nbsp;

(With inputs from agencies)

&nbsp;

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As the overall costs of keeping nationwide coronavirus-curbing measures in place are also rising, the fiscal budget for most of China’s local-level governments is tight.

As the overall costs of keeping nationwide coronavirus-curbing measures in place are also rising, the fiscal budget for most of China’s local-level governments is tight. People in Changshou district in the southwestern municipality of Chongqing, and Neijiang city in Sichuan province are being charged to stay in centralised quarantine facilities, a cost previously being borne by the government. The cost is as high as 300 yuan (US$40) per day in Changshou, according to a notice posted on the government’s WeChat account on September 21. Spending on a week's stay becomes almost impossible for most people. Also Read | The truth behind 'China coup' and Xi Jinping being 'under house arrest' Lack of finances has also disrupted public transport in many regions, such as Henan, Hunan and Guangdong. Experts see that financial problems at the local level are reflecting in almost every service and shows the local governments' inability to run basic services. Between 2021 and 2025, roughly three trillion yuan (US$415 billion) worth of bonds sold by local government financing vehicles (LGFVs) will mature annually. The repayment pressure has become increasingly significant, according to analysts. LGFVs are a popular platform for the local governments in China for borrowing, but disclosure of the use of funds is often poor. SCMP reported that on the evening of August 29, an LGFV in Gansu province made a last-minute dash to repay interest on a bond listed in the interbank market, after the Shanghai Clearing House announced earlier in the day that it had not received sufficient funds from the LGFV to meet its interest payment requirement. The delay in the interest payment immediately raised questions over the risks of a possible LGFV bond default in the listed market. China’s growth is slowing and it is not expected to meet its annual target gross domestic product (GDP) of “around 5.5 per cent” this year. (With inputs from agencies)

China's local governments in severe financial distress, risk bond defaults; crunch hits basic services

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