BEIJING: Despite the persistent challenges posed by a slump in the property sector and its impact on domestic demand, experts said they expect a notable economic upswing in China in 2024, fueled by a gradual recovery in services consumption and investment.
They said the government should promptly introduce policies that tap into the vitality of the services sector, such as further advancing the opening-up of the services sector, refining service supply and encouraging consumption of services.
Their comments came as a private survey released on Thursday showed that China’s services activity in December expanded at the fastest pace in five months, indicating that economic recovery is gaining further momentum.
The Caixin China General Services Purchasing Managers’ Index increased to 52.9 in December from 51.5 in November, media group Caixin said. A PMI reading of above 50 points to expansion, while one below that mark indicates contraction. Caixin’s composite PMI, which includes both manufacturing and services activities, came in at 52.6 in December from 51.6 in the previous month, recording the highest level since May.
“The latest figures signal the continued economic recovery trend, especially with the services sector gradually regaining vitality after COVID-19 disruptions,” said Hong Yong, an associate research fellow at the Chinese Academy of International Trade and Economic Cooperation’s e-commerce research institute. “The services sector has become a crucial force bolstering the growth of the world’s second-largest economy.”
Expanding service consumption is an essential means of supporting economic growth, said Hong, adding that service consumption and investment are expected to become new growth engines.
Data from the National Bureau of Statistics showed that retail sales of services in China grew by 19.5 percent year-on-year in the first 11 months of 2023, outpacing the 7.2 percent growth in retail sales of products during the same period. –The Daily Mail-China Daily news exchange item
