China estimates GDP growth rate at 5.3 percent in 2024

Key contributions from consumption, investment, and emerging industries
China estimates GDP growth rate at 5.3 percent in 2024
The recovery will span from the real economy to the service industry

The Chinese Academy of Sciences’ Center for Forecasting Science recently released a report offering a positive outlook for China’s GDP and overall economic trajectory in 2024. The report predicts a steady GDP growth rate of approximately 5.3 percent, reflecting the nation’s resilience and potential for sustained economic development.

The report delves into sector-specific growth projections for 2024. The year-on-year growth rates for the primary, secondary, and tertiary industries’ output are expected to reach 4.5 percent, 4.5 percent, and 6 percent, respectively. This balanced growth across sectors contributes to the overall stability of China’s economic landscape.

Contributions to GDP growth

The report outlines the expected contributions to China’s GDP growth in 2024. Consumption, investment, and net exports are estimated to contribute 3.7, 1.9, and -0.3 percentage points, respectively. This breakdown emphasizes the importance of China’s domestic consumption as a primary driver of GDP growth and economic expansion.

The report also suggests that China’s economic growth in 2024 will exhibit a pattern of starting low and ending high. China expects GDP growth in the first quarter to reach almost 5 percent. Moreover, it expects a 5.3 percent increase in the second quarter and a 5.5 percent increase in the third quarter.

Optimistic outlook

Hong Yongmiao, director of the center, expressed confidence in China’s economic development. The recovery will span from the real economy to the service industry, with the latter expected to rebound faster. China forecasts emerging industries, including new materials and new energy, to experience rapid development, contributing to overall GDP growth.

The report also highlights a faster pace of structural improvement in China’s fixed-asset investment since 2023. A discernible trend indicates transformation and upgrading in the manufacturing sector. Furthermore, it expects robust investment momentum in high-tech, intelligent, and green industries, as well as new infrastructure.

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Consumption, a driving force

In the first three quarters of 2023, China’s final consumption expenditure contributed significantly to GDP growth, accounting for 83.2 percent. The report anticipates that in 2024, the nominal year-on-year growth rate of China’s consumption will record between 4.2 percent and 5.1 percent. This further solidifies consumption’s role as a crucial driving force for economic growth.

The projections from the Chinese Academy of Sciences inspire optimism, indicating a path of steady growth for China’s economy in 2024, driven by diverse sectors and robust domestic consumption.

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