BEIJING, China, Thursday, March 28, 2024 – China’s economy has shown unexpected strength in the early months of 2024, raising questions about the need for further stimulus measures from the government, reports said. 1
Industrial output, a key indicator of manufacturing activity, surged by 7% in January and February compared to the same period last year, exceeding analyst expectations.
This growth has sparked debate among economists regarding the urgency of additional stimulus.
Previously, Chinese policymakers had signaled their intention to implement additional stimulus measures to bolster economic activity.
The Chinese economy faced headwinds in 2023 due to a property market slowdown, strict COVID-19 lockdowns, and a global slowdown.
To counter these challenges, the Chinese government planned a series of measures, including tax cuts, infrastructure spending increases, and easier access to credit for businesses.
The strong growth figures suggest the existing stimulus measures might be sufficient to propel economic expansion.
Injecting additional stimulus could lead to overheating, characterized by inflation and asset bubbles.
Policymakers might prioritize maintaining economic stability rather than chasing overly ambitious growth targets.
Despite the positive growth signs, some economists advocate for continued stimulus.
They say that the economic rebound might be temporary or short term, and underlying challenges like the property slowdown persist.
Global economic uncertainties, such as the ongoing war in Ukraine and potential recessions in major economies, could pose risks to China’s export-reliant economy.
- Stimulus: https://www.reuters.com/markets/asia/china-growth-target-achievable-if-backed-by-more-stimulus-analysts-say-2024-03-07/[↩]
