China's economy grew a bit more in 2023 than earlier thought, but the revision hasn't affected forecasts for "about 5%" growth in the GDP this year, the government said Thursday. The GDP estimate in 2023 for the world's second largest economy was increased by about 2.7% to $17.7 trillion, based on an economic census conducted every five years. Earlier this year, the government said the GDP in 2023 was $17.27 trillion. The exact impact on China's annual economic growth in 2023 wasn't given. Officials said further details would be released later. The economy grew at a 5.2% annual pace in 2023, according to the earlier estimate, up from 3% in 2022. The size of the US economy in 2023 was $27.36 trillion.
The census included years when COVID-19 was causing severe disruptions to business activity, travel, and ordinary activities in China. The economy is still recovering from those shocks and from a severe downturn in the housing market. The government has stepped up measures to counter the slowdown in consumer spending and business investment, pledging again this week to step up spending and issue more bonds to finance support from local governments that are suffering partly due to the property crisis. Such efforts are helping, the World Bank said in a report Thursday, lifting its estimate for China's growth this year to 4.9% from its forecast in June of 4.8%.
The World Bank's update for China's annual growth next year was raised to 4.5% from 4.1%, but it still shows growth slowing in coming years. Weakness in the property sector remains a drag on growth, and people whose houses have lost value will remain reluctant to spend. That will keep inflation low, the report said, at 0.4% for this year, rising to 1.1% in 2025. It noted that while moves to boost demand by cutting mortgage down payments and interest rates, and funding affordable housing projects are supporting demand, such measures won't do enough to restore growth to higher levels. The risk of higher tariffs on Chinese exports to the US once President-elect Trump takes office and other limits on trade are other potential threats to the economy.
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