A cracking end to 2024 for China’s economy
After a sluggish two quarters, GDP growth romped home in Q4.
Per data released by the stats bureau (NBS) on Friday:
Real GDP grew by 5.4% y/y in the last quarter of 2024, a big acceleration from 4.6% growth in Q3.
- Quarter-on-quarter, the GDP rose 1.6% in Q4, compared with a 1.3% expansion in Q3.
Real growth in China’s secondary industry – encompassing industrial upgrading and high-tech manufacturing – picked up, expanding by 5.2% y/y, after slumping to 4.6% in Q3.
Meanwhile, China’s full-year GDP for 2024 expanded by 5% y/y, easily meeting Beijing’s target of around 5%.
- In 2023, the economy grew 5.2%.
Net exports contributed to 30.3% of economic growth in 2024, its highest share since the late 90s.
- Consumption was responsible for a measly 44.5% – in the decade prior to COVID, it was rarely less than 55%.
- Investment contributed 25.2%.
Get smart: Beijing will rely on exports to underpin growth again this year, but it will come at the cost of mounting trade tensions.
Get smarter: This was a stellar end to the year for China’s economy.
- That said, there is some doubt – as usual – as to whether the numbers are trustworthy, not least because recent stimulus efforts have been so underwhelming.
Our take: Even if the numbers were massaged a little, growth definitely picked up in Q4.
- But maintaining that momentum into 2025 will be an ongoing challenge.