China announces 3% GDP growth for 2022 as December retail sales and industrial production beat estimates

Chinese authorities are expecting about twice as many Lunar New Year trips this year as last, as many people can return to their hometowns without any Covid restrictions. Pictured is Jinan West Railway Station on January 1. 15, 2023.

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BEIJING — China reported 2022 GDP growth that beat expectations, with retail sales in December coming in much better than expected.

GDP grew by 3% in 2022, the National Bureau of Statistics announced on Tuesday. That was better than the 2.8% predicted in a Reuters poll. The GDP growth figure fell short of the official target of around 5.5% set in March. In 2021, Chinese growth had rebounded by 8.4% against only 2.2% growth in 2020.

Fourth-quarter GDP rose 2.9%, beating Reuters poll expectations of 1.8% growth.

Retail sales fell 0.2% for the year. But retail sales in December were down 1.8% from a year ago, less than the expected 8.6% plunge predicted by a Reuters poll.

Within retail sales, restaurant sales fell 6.3% in 2022. Clothing, cosmetics and jewelry sales all fell over the year. Medicine was one bright spot, after sales jumped nearly 40% in December from a year ago.

Online retail sales of physical goods rose 17.2% in December from a year ago, according to CNBC calculations of official data accessed through Wind. These online sales accounted for 27.2% of total retail sales.

In 2022, metropolitan Shanghai went into lockdown for about two months in an attempt to control a Covid outbreak. China’s strict zero-Covid policy has limited travel and business activities across the country.

Authorities abruptly relaxed most controls in early December, amid a surge in local infections. With many more people planning to travel around the upcoming Lunar New Year, analysts expect Chinese consumer sentiment to take a few months to recover.

Industrial production rose 3.6% in 2022. The figure rose 1.3% in December, well above the 0.2% forecast by the Reuters poll.

Capital investment for 2022 rose 5.1%, slightly above the 5% expected by Reuters. Year-to-date, infrastructure investment grew faster in December than in November, while manufacturing investment growth slowed. Real estate investment fell 10% in 2022, a steeper drop than recorded for the year through November.

The unemployment rate in cities was 5.5% in December, while that of young people aged 16 to 24 remained much higher at 16.7%.

“The basis for (the) domestic economic recovery is not solid because the international situation is still complicated and serious while the domestic triple pressure of contraction of demand, shock of supply and weakening of expectations still looms,” the statistics office said in a statement.

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