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Economic rebound expected to continue

2024-05-09 18:04chinadaily
by Ouyang Shijia
A staff member assembles a planter at the workshop of an agricultural machinery manufacturing enterprise in Jiamusi, Northeast China's Heilongjiang province on March 12. [Photo/Xinhua]

China's economy is poised for a steady rebound throughout this year, underpinned by consumer-led recovery, a robust foundation laid in the first quarter, and the gradual stabilization of the property sector, experts said.

While the broader economy is still facing pressures from still-weak domestic demand and mounting uncertainties both at home and abroad, the experts said the country still enjoys favorable conditions and positive factors that will further consolidate the recovery trend.

Their comments came as the results of a private survey released on Monday showed that China's services activity expanded for the 16th consecutive month in April, indicating that economic recovery is gaining further momentum. 

The Caixin China General Services Purchasing Managers' Index came in at 52.5 in April, down from 52.7 in March, media group Caixin said. A PMI reading above 50 indicates expansion, while one below that mark points to contraction. 

Caixin's composite PMI, which includes both manufacturing and services activities, rose to 52.8 in April from 52.7 the previous month, recording the fastest growth rate since May last year.

Gu Yan, director of Research Department I of the Xi Jinping Thought on Economy Study Center, said the "scarring effect" caused by the COVID-19 pandemic is gradually fading away, as more Chinese are now willing, and have the potential, to spend more.

Gu made the remark at a meeting on China's economic situation held in Beijing on Monday. He said that consumption will continue to recover this year, given the implementation of the country's policies to encourage consumption and the strong resilience of the Chinese economy.

Wang Zhe, senior economist at Caixin Insight Group, said the Caixin PMI readings are consistent with the year's strong start, as China's economic performance in the first quarter surpassed market expectations, with steady growth in manufacturing and a gradual recovery in consumption.

Mao Kejun, director of the Xi Jinping Thought on Economy Study Center's Research Department III, highlighted the robust industrial production in the first quarter, expressing strong confidence about China's long-term development.

"China's economy still enjoys favorable conditions and positive factors, including its powerful industrial production capacity and a complete industrial system," Mao said.

A meeting of the Political Bureau of the Communist Party of China Central Committee held last week said the country will take steps to expand domestic demand, advance large-scale equipment renewal and the trade-in of consumer goods, and introduce more consumption scenarios and promote people-centered new urbanization. The meeting also called for research on policies and measures to reduce housing inventory and improve the quality of newly added housing. 

Chinese property shares surged on Monday amid a series of positive updates. Huayuan Property, Langold Real Estate and New Dazheng Property Group saw their shares increase by the 10 percent daily trading limit on Monday, according to Shanghai-based information provider Wind Info. 

Xiong Yuan, chief economist at Guosheng Securities, said that China's second-quarter GDP growth rate is likely to hit around 6 percent, and the country needs to take more steps to better implement existing supportive policies and keep stimulus efforts persistent.