China’s economy predicted to hit its 2023 growth target

China is anticipated to meet Beijing’s economic objective for 2023, with a top official think tank forecasting 5.1% GDP growth in the fourth quarter, but stronger countercyclical policies are still required to preserve long-term stability.

The Institute of Economics of the Chinese Academy of Social Sciences (CASS) forecasted that the world’s second-largest economy grew by 4.6 percent year on year in the third quarter, down from 6.3 percent in the second quarter.

According to research released on Friday, the rising service sector will fuel economic development, but new internal and global problems will emerge.

“The Chinese economy is presently facing a time of favorable tailwinds for service sector recovery, mixed with headwinds of diminishing global demand for manufactured products,” according to the CASS analysis.

The economic comeback in the second half of the year, however, is still forecast to secure annual growth of 5.1%, matching Beijing’s growth objective of approximately 5% for 2023.

China is anticipated to report third-quarter GDP statistics, as well as important retail sales and industrial output figures for September, next week.

It is experiencing an economic recession as demand remains depressed and the falling property market, debt-ridden local governments, and a grim export outlook continue to undermine confidence in the private sector.

The positive forecast from CASS contrasted with that of many international investment banks, which remain skeptical about China’s economic prospects since officials have abstained from large-scale intervention to boost short-term growth.

According to the Beijing-based research group, young unemployment should have peaked in July and begun to level out in August.

In China, unemployment among the 16-24 age group had risen to 21% in June when Beijing paused data release in August, claiming the need to provide time for survey figures to be “further enhanced and optimized.”