Explainer | China’s GDP, population, youth-jobless rate: 6 takeaways from the economy in January

China confirmed its economy grew by 5.2 per cent in 2023, while also revealing its population fell to 1.4097 billion
Authorities resumed the release of China’s youth-unemployment data, with a twist, and announced a cut in the total cash that commercial banks must hold in reserve, to ease market concerns

China's economic recovery

Andrew Mullen

Published: 12:00am, 1 Feb 2024

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1. China’s recovery is ‘still shaky’ despite 5.2% growth in 2023

One of the most anticipated events in January was the confirmation that China’s economy grew by 5.2 per cent in 2023, which met the “around 5 per cent” growth target.

The world’s second-largest economy, though, is still facing multiple headwinds in the early going of 2024, particularly after property investment fell by 9.6 per cent in 2023.

Beijing is set to reveal its annual gross domestic product growth target in March, but cities and provinces started to confirm their own goals in January.

The southern powerhouse of Guangdong province said it would aim to grow its economy by 5 per cent this year, though some of China’s most indebted regions have set more conservative economic growth targets.

Analysts said China’s economic “recovery is still shaky”, and that achieving the same pace of growth in 2024 will prove a lot more challenging than last year.

2. Population decline a ‘concerning trend’

Another highly watched figure in January was China’s population figure for 2023, which confirmed that the overall population fell by 2.08 million in 2023, while births declined by 5.6 per cent to 9.02 million.

The overall population in mainland China fell to 1.4097 billion in 2023, down from 1.4118 billion in 2022.

03:23

China posts record-low birth rate despite government push for babies

About 11 million people died in 2023, pushing the death rate to a five-decade high.

Analysts said China’s population decline last year was a “concerning trend”, while it aligned with their earlier projections.

3. Youth-jobless rate returns

China also released its youth-jobless rate in January, with the revised figure showing that 14.9 per cent of the 16-to-24 age demographic was unemployed in December.

The jobless rate for that age group had been gradually climbing since 2020, hitting a record high of 21.3 per cent in June of last year before its release was suspended a month later.

The National Bureau of Statistics said the adjusted figure did not include students.

But analysts said it was difficult to gauge the adjusted unemployment data without any historical comparisons.

4. Central bank cuts reserve requirement ratio

China responded to dwindling market confidence in January by cutting the amount of cash that commercial banks must hold as reserves from February 5.

The 50-basis-point cut to the reserve requirement ratio is expected to inject 1 trillion yuan (US$140 billion) worth of liquidity into the market.

“We’ll create a good monetary and financial environment for the operation of financial markets, including capital markets,” central bank governor Pan Gongsheng.

Hong Kong economy grows less-than-expected 3.2% in 2023

China’s financial regulator also turned its sights on the property market, vowing measures such as better support for cash-strapped developers, and mortgage policies designed to offer more help for households.

And Premier Li Qiang ordered authorities to find ways of attracting long-term investors to the country’s capital markets.

5. Exports ‘simply returning to pre-pandemic levels’

China’s overall trade fell by 5 per cent in 2023, year on year, with exports falling by 4.6 per cent.

Shipments to the Association of Southeast Asian Nations, China’s largest trading partner, fell by 5 per cent in 2023, while exports to the European Union – its second-largest partner – plunged by 10.2 per cent.

China’s exports to Russia, though, soared by 46.9 per cent in 2023, year on year, while imports from its northern neighbour rose by 12.7 per cent.

“While it’s true that China’s exports don’t look promising in figures, the export surge in the past three years during the pandemic was abnormal, and China’s exports are now just simply returning to pre-pandemic levels,” said Ding Shuang, chief Greater China economist at Standard Chartered Bank.

6. Inflation hits 13-year low in 2023

China’s consumer price index (CPI) remained in positive territory at 0.2 per cent in 2023, but the 13-year low underlined the issues facing Beijing after Japan’s lost decades – commonly known as Japanification – were accompanied by deflation, a property slump and a demographic crisis.

The CPI reading fell in December by 0.3 per cent, year on year, while the producer price index – which measures costs for goods at the factory gate – fell for the 15th consecutive month in December and dropped by 2.7 per cent, year on year.

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