China's Q1 GDP growth indicates good start: experts

(ECNS) -- Experts said the year-on-year growth rate of 4.5 percent in the first quarter of 2023 has exceeded expectations, and judging from main indicators, China’s economy made a good start this year.

Xu Hongcai, deputy director of the China Association of Policy Science's economic policy committee, said the 4.5 percent growth mainly relied on the service sector.

As the impact of the COVID-19 pandemic on the economy gradually decreases, service industries have obviously rebounded, said Xu, adding that the consumption brought by traveling, catering, entertainment and tourism has increased rapidly, which has strongly supported economic growth.

With the optimization and adjustment of pandemic prevention and control policies, various policies and measures to stabilize growth, employment and prices have been put in place quickly.

Supported by advanced and sufficient policies, market participants' expectations continue to improve, and market confidence has been restored, said Zhao Xijun, joint dean of the China Capital Market Research Institute, Renmin University of China.

Meanwhile, data on consumption, foreign trade and other aspects performed quite well in the first quarter, resulting in economic growth this quarter beating expectations, Zhao said.

Consumption and foreign trade contributed a lot to the growth. HuoJianguo, vice-chairman of the China Society for World Trade Organization Studies, said the soaring growth of foreign trade in March was the result of the quick resumption of production after the Spring Festival.

“It also showed the world still needs China’s products and orders have supported the development of foreign trade,” he said.

Xu predicted that the economic growth rate will be higher in the second quarter, possibly exceeding six percent, and the annual economic growth rate may be around 5.4 percent.

A number of global institutions, including the International Monetary Fund, raised their 2023 growth forecast window for China earlier this year.

The IMF projected that China's economy will grow 5.2 percent in 2023. The World Bank's latest forecast has upgraded China's economic growth projection to 5.1 percent this year, compared with 4.3 percent in January.

Besides, the Organization for Economic Co-operation and Development has lifted its projection of China's 2023 GDP growth to 5.3 percent from a previous estimate of 4.6 percent.