The National Statistical Service pointed out that the indices of entrepreneurial assessments and expectations for the manufacturing and non-manufacturing sectors remain high: 54.7 and 62.3 points, respectively. Last month’s summary statistics also showed a stable position and a positive trend in the national economy.
Economists remind that in practice, even negative indicators of the business activity index from 50 to 44 do not mean a decline, but only indicate a decrease in the growth rate of value-added production. Industrial production in April, even with an index of 49.2 points, posted an increase of 5.6% over one year. Traditionally, the production of cars using new energy sources has increased rapidly: 85.4% in January-April. The production of solar panels increased by 69.1%.
The services sector in April showed a growth rate of 13.5%. The growth leaders were restaurants and hotels (+48.7% year-on-year) and logistics (+17.6%).
Russia has kept the laurels of the champion in terms of foreign trade turnover growth with China for several months in a row
A strong “post-COVID rebound” in retail has consolidated across the country, rising 18.4% in April. Observers’ note: the Chinese consumer has finally started to open the “corona crisis capsules”. According to the People’s Bank of China (Central Bank), Chinese household savings recorded negative growth in April for the first time in many months, falling 1.2 trillion yuan. If in 2021-2022 the total amount of savings in China increased by an average of 1.2 trillion yuan per month, then from October last year to March this year these rates doubled to 3 000 billion yuan per month. Finally, last month, the situation was reversed. Analysts cite several reasons for this. This is an increase in consumer confidence on the one hand, on the other hand, it has the effect of lowering deposit rates by banks.
The fastest growth was demonstrated by sales of gold and jewelry: 44.7%. The car market in the People’s Republic of China, which had weakened, has practically recovered. If according to the results of the first quarter, passenger car sales fell by 13.4% year-on-year, then in April a sharp increase of 55.5% was demonstrated. An active April slowed the rate of decline in sales for four months to 1.3% year-on-year. The real estate market, which suffered from a protracted crisis, is showing signs of stabilization. According to the four-month results, sales, although they fell in physical terms by 0.4% in monetary terms, recorded an increase of up to 8.8%. At the same time, the authorities do not cancel the policy aimed at limiting the sharp decline in property prices. Last month, two real estate agents were immediately punished for discounts of 20-25%.
Growth in China’s service sector was driven by restaurants and hotels, with sales of gold and jewelry showing rapid growth.
Positive dynamics were shown by investments in fixed assets, which increased by 4.7% in January-April, including investments in infrastructure – by 8.5% and in industrial production – by 6.4%. .
Despite the gloomy forecasts announced at the beginning of the year, Chinese foreign trade is developing rapidly. In April, its growth was 8.9%. Exports were particularly strong, jumping 16.8% year-on-year. The main growth areas for Chinese exports were the countries of the Association of Southeast Asian Nations (24.1%), Africa (36.9%) and the Middle East (the growth of supply to Saudi Arabia reached 51.3%, to the United Arab Emirates – 31.9%) . At the same time, it is not easy for Chinese manufacturers to expand their exports in these directions: profitability in these markets is about a third lower. “If the profit from a cup sold in Europe or the USA is 1.5 yuan, then in Africa or Southeast Asia it is 1 yuan,” says one of the suppliers “on the fingers”. Consequently, in order to maintain profits at the expected levels, it is necessary to provide more.
Russia has kept the laurels of the champion in terms of foreign trade turnover growth with China for several months in a row. In January-April, bilateral trade increased by 52.8 percent compared to the same period last year, reaching 503 billion yuan (1 yuan – 11.1 rubles). Exports of Chinese products to Russia jumped by 81% (separately in April – by 153.1%), imports from Russia increased by 34%. At the same time, Russia maintains a positive trade balance with China: in four months, it reached 39 billion yuan. In dollar terms, bilateral trade increased by 41.3% to $73.1 billion. Observers confidently assert that by the end of the year, bilateral trade will for the first time exceed the level psychologically significant $200 billion.
At the same time, new growth points for Russian-Chinese trade are created. So, at the beginning of May, Vladimir Putin instructed “to consider the issue of concluding an intergovernmental agreement between the Russian Federation and the People’s Republic of China on the project” New land grain corridor Russia – China “. The Russian government approved an intergovernmental agreement with China on the supply of Russian gas to China via the Far East route, through which in the future China will be supplied with up to 10 billion cubic meters of Russian gas per year .
Exports of Chinese products to Russia jumped by 81% (separately in April – by 153.1%), imports from Russia increased by 34%
New decisions and new agreements are expected following the upcoming Russian-Chinese business forum in Shanghai, which will be held within the framework of Russian Prime Minister Mikhail Mishustin’s visit to China. The forum brought together a large delegation of entrepreneurs from the Russian Federation numbering about 500 people. The forum also discusses cooperation in areas such as industry and agriculture, energy and the digital economy.
At the same time, the Chinese press carried out a powerful “artillery preparation” for Mishustin’s visit, stressing that China, by developing economic cooperation with the Russian Federation, would not reverse Western anti-Russian sanctions. or threats of secondary sanctions. Thus, an editorial in the Global Times pointed out: “The united West, led by the United States, imposes unprecedented sanctions against Russia and tries to force more countries to join them. At the same time, these unilateral sanctions are imposed without UN approval and are therefore illegal under international law. The United States has no right to order other countries to join its illegal unilateral sanctions.”
Overall, the positive situation of the Chinese economy helped reduce unemployment by 0.1 percentage point in April to 5.1%. At the same time, among the young and able-bodied population of the PRC, aged 16-24, it continues to deteriorate. If in March the unemployment rate in this age group was 19.6%, in April it jumped to 20.4%. Economists call for urgent action to expand youth employment. One such measure was the decision to lift the moratorium on petty street trading in many major cities. The ban will be lifted by southern China’s metropolis Shenzhen, the administrative center of Gansu province – the city of Lanzhou – and others.
China has also succeeded in containing inflation. In April, the consumer price index in the country rose by 0.1% year on year, and compared to March, it fell by 0.1%. Inflation was driven by the prices of fruit (5.3% growth) and fresh vegetables (13.5%). The prices of other goods and services remained unchanged or even fell, as happened in transport. The harbinger of inflation, the producer price index, fell 3.6% year-on-year and 0.5% month-on-month. This makes it possible to say that a sharp increase in inflationary pressures in the PRC is not expected in the short term.
Assessing the current situation, economists predict that China’s GDP growth will reach 8% in the second quarter from 4.5% in the first quarter. There will be no stagnation, they stress.
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