China reports ‘hard-won’ economic results for 2023, as two sessions to focus on continued recovery

China on Thursday released the statistical communique on national economic and social development in 2023, reaffirming that the Chinese economy maintained recovery momentum and made solid progress in pursuing high-quality development despite internal and external challenges.

Coming just days before China kicks off the annual two sessions, one of the most important political gathering each year, the communique, which drew a more comprehensive picture of the Chinese economy in 2023, laid a solid foundation for economic recovery in 2024 and provided valuable signals for where the Chinese economy is headed and top policy priorities for the year, analysts noted.

A slew of social and economic development goals for 2024 will be set at the annual legislative and political consultative sessions, with the GDP growth target among the most closely watched. Chinese national lawmakers, political advisers and analysts said that the focus will be on further consolidating economic recovery and continuing efforts to pursue high-quality development. Some economists expect the GDP growth target to be set at around 5 percent for 2024.

China's economy grew by 5.2 percent year-on-year in 2023, according to the statistical communique released by the National Bureau of Statistics (NBS) on Thursday, reaffirming the figure released in January and staying above the official GDP growth target of around 5 percent in 2023. Meanwhile, the per capita GDP in 2023 increased by 5.4 percent over the previous year.

The statistical communique "highlighted the upward trajectory of the Chinese economy forging ahead with wave-like development despite pressure and depicted a vivid picture of Chinese modernization laying a solid foundation, gathering steam, and making progress while maintaining stability," Sheng Laiyun, deputy director of the NBS, wrote in an article analyzing the statistical communique.

Sheng further pointed out that currently and for a good period in the future, China's development faces and will continue to face both strategic opportunities as well as risks and challenges, "but the opportunities outweigh the challenges and the favorable conditions outweigh the unfavorable factors."

Eye on two sessions

With the complete picture of China's social and economic development released, all eyes are now turning to the upcoming two sessions, which will offer a crucial window into how the country sets various development goals and how it plans to achieve them.

The second session of the 14th National People's Congress (NPC), China's top legislature, and the second session of the 14th National Committee of the Chinese People's Political Consultative Conference (CPPCC), the country's top political advisory body, will open on March 5 and 4, respectively. Collectively, they are known as the two sessions. One of the top items on the agenda during the two sessions is the government work report, which is expected to be delivered to the plenum of the NPC's second session and contain a flurry of policy goals this year.

Underscoring the importance of the report, the Political Bureau of the Communist Party of China (CPC) Central Committee met on Thursday to discuss the draft government work report, which will be submitted by the State Council at the top legislature's annual session in March for deliberation, according to Xinhua.

It was noted at the meeting that over the past year, in the face of an exceptionally complicated international environment and the arduous tasks of reform, development and maintaining stability, China has achieved a smooth transition in its COVID-19 response and has seen economic recovery and growth.

"The government work report will coordinate development and security, supply-side structural reform and insufficient effective demand, strategic tasks of Chinese modernization, and reform and opening up so as to promote high-quality development of the economy," Yu Miaojie, a deputy to the NPC and president of Liaoning University, told the Global Times.

Yu said that China's GDP growth rate is expected to reach 5.3 to 5.4 percent in 2024 despite headwinds and choppy waters in the international environment and challenging tasks in promoting reform and development at home. In addition to the GDP growth target, Yu also expects the deficit-to-GDP ratio will be set at 3 percent for 2024.

Zhou Hongyi, a member of the National Committee of the CPPCC and founder and chairman of 360 Security Technology, said that another main focus will be on forming new productive forces, which aims to use scientific and technological innovation to drive productivity.

"In the context of a new round of scientific and technological revolution and accelerated industrial transformation, our country insists on placing scientific and technological innovation at the core of the country's overall development," Zhou told the Global Times.

Chinese top officials have been stressing the need to pursue sci-tech breakthroughs and develop new productive forces, as the economy undergoes a profound transformation and faces a deteriorating external environment marked by the US' relentless campaign to contain China's economic and technological rise.

A key issue to watch out for is how policymakers plan to tackle various challenges and risks, while also pushing ahead key reforms, economists said.

"Preventing risks and promoting reform need to be carried out simultaneously. We still need to introduce more measures to resolve local debt risks. At the same time, the international environment is in a state of turbulence. How China plans to carry out high-quality development and promote high-level opening-up is also drawing great global attention," Wan Zhe, an economist and professor at the Belt and Road School of Beijing Normal University, told the Global Times on Thursday.

In terms of the official GDP growth target, Wan said, judging from targets set by localities during the local two sessions, which averaged a growth rate of 5.4 percent, the Government Work Report will likely set a growth target of around 5 percent. "This is a relatively high target, indicating that the central government has high confidence in the market," she said.

Zhang Shuibo, an NPC deputy and a professor at the College of Management and Economics of Tianjin University, said that tackling overcapacity and improving the business environment are also at the top of the agenda for 2024, in line with top priorities set during the Central Economic Work Conference.

"As long as we make the business environment better and keep a stable policy environment," businesses will have greater expectations for making profits, despite the impact of other factors, Zhang told the Global Times on Thursday.

Despite lingering downward pressure, China's economic recovery is off to a great start this year. In a striking example, record-high figures for domestic travel and spending were recorded during the Chinese Lunar New Year holidays, with both figures also largely exceeding those of the same period in 2019 before the outbreak of the COVID-19 pandemic.