- In 2023, China’s GDP grew by 5.2 percent, successfully meeting the national target of around 5 percent growth. However, at the provincial level, nearly half of the provinces missed their individual growth targets for the same year, with an average deficit of about 0.4 percentage points. Although the specific data for Xinjiang and Hubei have not been released, their Q3 figures suggest that they are also likely to fall short of their respective targets.
- Of the 27 provinces that have disclosed their 2024 targets so far, only 4 have set their goals higher than the previous year, while 13 have made downward adjustments. In comparison to 2023, the average downward adjustment for the coming year is almost 0.3 percentage points.
- In 2023, 6 percent was the most common target, adopted by 12 provinces; however, 5 percent has become the predominant target for 2024, adopted by 10 provinces so far. In addition, so far only 2 provinces are targeting more than 6 percent in 2024, Tibet and Hainan, a significant decrease from the 8 provinces targeting this in 2023.
- Several factors contributed to the provinces’ failure to meet their targets. These include the ongoing property crisis, characterized by falling housing prices and a slump in housing construction. In addition, the private sector, which accounts for more than 60 percent of the country’s GDP, is struggling in times of weak demand.
- Achieving a comparable rate to that of 2023 this year may become more difficult, given the higher baseline for comparison and ongoing challenges. While a stimulus package targeted at specific areas of the economy is planned for 2024, Premier Li Qiang has also clearly indicated that Beijing will not rely on massive stimulus to drive short-term growth this year.
Sinolytics is a research-based business consultancy entirely focused on China. It advises European companies on their strategic orientation and specific business activities in the People’s Republic.