IMF says China’s economy is projected to grow by 5.2% in 2023, profits of China’s major industrial firms declined 4% y-o-y

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Xinhua News/Reuters

31st January 2023 – (Beijing) IMF says China’s economy is projected to grow by 5.2% in 2023. According to Reuters, The International Monetary Fund on Tuesday raised its 2023 global growth outlook slightly due to “surprisingly resilient” demand in the United States and Europe, an easing of energy costs and the reopening of China’s economy after Beijing abandoned its strict COVID-19 restrictions.

“Growth is expected to pick up in China with the full reopening in 2023,” the IMF said in the newly released update to its World Economic Outlook report.

Global growth is projected to fall from an estimated 3.4 percent in 2022 to 2.9 percent in 2023, then rise to 3.1 percent in 2024, the IMF said, noting that the historical average growth rate between 2000 and 2019 is 3.8 percent.

The IMF said the rise in central bank rates to fight inflation and Russia-Ukraine conflict continue to weigh on economic activity. 

Profits of China’s major industrial firms declined 4 percent year on year in 2022, data from the National Bureau of Statistics (NBS) showed Tuesday.

Industrial firms with annual main business revenue of at least 20 million yuan (about 2.96 million U.S. dollars) saw their combined profits reach about 8.4 trillion yuan in the period, the NBS said.

The purchasing managers’ index (PMI) for China’s manufacturing sector came in at 50.1 in January, up from 47 in last December, data from the National Bureau of Statistics showed Tuesday.

A reading above 50 indicates expansion, while a reading below reflects contraction.