China's economy last year suffered one of its worst annual performances in more than three decades, official figures showed on Wednesday, January 17, as the country battled a crippling property crisis, sluggish consumption and global turmoil. Gross domestic product expanded 5.2% to hit 126 trillion yuan ($17.6 trillion), China's National Bureau of Statistics (NBS) reported.
Official GDP figures remain a key source of insight into the health of the world's second-largest economy, despite being eminently political. Wednesday's reading is an improvement on the 3% growth recorded in 2022, a year that saw business activity hammered by tight health curbs designed to contain Covid-19. But excluding the pandemic years, 2023 marked China's weakest performance since 1990.
After lifting its draconian pandemic measures at the end of 2022, Beijing set itself a growth target of "around five percent" for last year. The economy enjoyed an initial post-pandemic rebound but ran out of steam within months as a lack of confidence among households and businesses battered consumption.
An intractable real estate crisis, record youth unemployment and a global slowdown are also gumming the gears of the Chinese growth engine. The country's exports – historically a key growth lever – fell last year for the first time since 2016, according to figures published by the customs agency on Friday.
Geopolitical tensions with the United States and efforts by some Western nations to reduce dependence on China or diversify their supply chains have also hit growth. Officials are due to release their growth target for 2024 in March.
Population decline
China's NBS also reported a population decline that accelerated in 2023, extending a downward streak after more than six decades of growth as the country battles a looming demographic crisis.
Once the world's most populous country, China was overtaken by India last year, with Beijing now scrambling to boost falling birth rates through subsidies and pro-fertility propaganda. "By the end of 2023, the national population was 1,409.67 million... a decrease of 2.08 million over that at the end of 2022," NBS said Wednesday.
Last year's decline was more than double the fall reported for 2022, when the country lost 850,000 people as its population shrank for the first time since 1960. "In 2023, the number of births was 9.02 million with a birth rate of 6.39 per thousand," the NBS said Wednesday, down from 9.56 million births in 2022.
China ended its strict "one-child policy", imposed in the 1980s amid overpopulation fears, in 2016 and started letting couples have three children in 2021. But that has failed to reverse the demographic decline for a country that has long relied on its vast workforce as a driver of economic growth. Many blame falling birth rates on the soaring cost of living, as well as the growing number of women going into the workforce and seeking higher education.