China’s economy grew by 5% in 2022, meeting the government’s annual growth target despite a slowing pace in the final quarter of the year. However, the data has raised concerns among analysts about the accuracy of the official figures.
The National Bureau of Statistics reported that China’s GDP grew by 4.5% in the last three months of 2022 compared to the same period a year earlier. This was a slowdown from the previous quarter’s growth rate, reflecting the ongoing challenges faced by the world’s second-largest economy.
While China’s government had set a target of “around 5%” economic growth for 2022, the country has struggled to boost domestic spending and overcome a prolonged property crisis, as well as the turmoil caused by the US-China trade tensions.
Zichun Huang, a China economist at Capital Economics, said her company’s own calculations suggest that China’s official growth figures “overstate the pace of economic expansion” by at least 1.5 percentage points.
The data also showed that China registered the lowest number of births last year since records began in 1949, with the total number of births dropping to 7.9 million. This highlights the country’s deepening demographic crisis, even as the government tries to boost birth rates by offering incentives to couples.
Despite the economic headwinds, China reported the world’s largest-ever trade surplus last week, driven by a rise in exports to markets outside the US. However, the country’s reliance on exports is likely to be tested in the year ahead, as the Trump administration continues to use tariffs as a key economic policy.
Kang Yi, the head of China’s National Bureau of Statistics, acknowledged that the country’s economy “faces problems and challenges, including strong supply and weak demand,” but added that it will be able to “maintain stable, sound growth momentum this year.”
Analysts have warned that China’s reported GDP growth of 5% is not surprising given the political incentives to ensure headline stability, but it “clearly masks the horrible investment data” in the country.
The government has pledged “proactive” fiscal policies this year as it looks to increase domestic spending and shift reliance away from exports and investment. However, the path to sustainable economic growth remains uncertain in the face of ongoing challenges.
