Despite lingering concerns over sluggish domestic demand, the Chinese economy recorded a growth rate of 4.5% in the third quarter of this year, slightly beating market expectations thanks to robust exports. Consequently, barring unforeseen circumstances, the annual growth target of 4.5% to 5% is projected to be well within reach.

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A media report projecting that China will be able to achieve this year's economic growth target. / Economic Daily (Jingji Ribao)

According to reports by media outlets including the Economic Daily on the 20th, China's National Bureau of Statistics announced the previous day that third-quarter gross domestic product (GDP) grew 4.5% year-on-year. The figure narrowly beat the market consensus of 4.4% compiled by foreign news outlets such as Reuters and Bloomberg News. With this, GDP growth for the first three quarters of this year stood at 4.6% compared to the same period last year.

Synthesizing media reports, China's GDP growth performance initially showed robust momentum by recording 5.0% in the first quarter. In the second quarter, however, it slipped to 4.3%, recording its lowest level in roughly three years since the fourth quarter of 2022. Because of this, growth prospects for the second half of the year had indeed turned somewhat pessimistic, making calls to stimulate domestic demand inevitable.

Contrary to initial concerns, however, third-quarter performance proved relatively solid. Thanks to this, authorities have been able to ease burdens on steering the economy in the fourth quarter. Factoring in the growth rate across the first three quarters, this can be affirmed with confidence.

According to Beijing sources well-versed in Greater China economic affairs on the 20th, China is sustaining an export rally amid the global artificial intelligence (AI) boom despite sluggish domestic demand. Given that its trade surplus from January to September reached $938.11 billion and appears set to surpass $1 trillion soon, little further explanation is needed. Robust export performance appears to be making up for sluggish domestic demand that shows no sign of turning around.

Delving into the details, however, it is also true that a significant portion of indicators remains unsatisfactory. Above all, the real estate sector shows few signs of recovery. A 0.14% month-on-month decline in new home prices across 70 major cities in September serves as clear evidence supporting this assessment.

The unemployment rate is little different. Although the urban surveyed unemployment rate in September edged down 0.1 percentage point from the previous month to 5.2%, it is difficult to view positively if interpreted as having been driven by the surge in the so-called gig economy centered on flexible labor. This points to a fairly burdensome road ahead for Chinese authorities in managing the economy next year.

                                                                                                            Hong Soon-do