Shortly after the conclusion of the National Two Sessions, the Chinese economy has delivered a performance that exceeded expectations. Data released on the 16th by the National Bureau of Statistics for the January-February period shows that the "troika" driving economic growth—exports, consumption, and investment—has all picked up speed. Imports and exports surged by double digits, consumption growth accelerated, and investment shifted from decline to growth.
Against a backdrop of a volatile international environment, how has the Chinese economy managed to withstand pressure and achieve a stable start to the year? Wen Bin, Chief Economist at China Minsheng Bank, identified two key factors: the manifestation of policy effects and a rebound in endogenous momentum. "On one hand, the front-loading of special bond issuance has boosted infrastructure investment, and the property market is showing early signs of a 'small sunny spell.' On the other hand, better-than-expected exports and a continued recovery in prices are driving a rebound in manufacturing investment, while the extended holiday period has also supported household consumption, particularly in services," Wen explained. The combination of these forces has underpinned the economic foundation at the start of the year.
Two economic indicators within this report card stand out. The first is foreign trade. In the first two months, the total value of goods imports and exports reached 7.7321 trillion yuan, a year-on-year increase of 18.3%, which is 13.4 percentage points faster than the growth rate in December of the previous year. Exports saw a particularly sharp rise of 19.2%. This data surpassed market expectations. Given that the base for foreign trade was already high last year, achieving such growth this year sufficiently demonstrates the strong resilience and developmental vitality of China's foreign trade.
Another noteworthy detail is that the rebound in goods imports was stronger than that of exports. This sends two signals: domestic demand is recovering, and China is providing new opportunities for trade development to countries around the world.
The second standout indicator is consumption. The willingness of people to spend is a barometer of economic vitality. In the first two months, total retail sales of consumer goods surpassed 8.6 trillion yuan, a year-on-year increase of 2.8%, which is 1.9 percentage points faster than the growth in December. Catering revenue exceeded one trillion yuan, reflecting a bustling consumer market. Since the beginning of the year, driven by policies aimed at stimulating consumption and the influence of the extended Spring Festival holiday, market sales have seen a significant rebound. The potential for service consumption has been unleashed, and new forms of consumption have gained momentum. For instance, the online short drama market is booming, with platform data showing transaction volumes on short drama platforms growing by over 30% in January-February. New business formats such as green consumption, health-related consumption, and debut economy are increasingly contributing to consumption growth.
Wen Bin believes that this year's Government Work Report maintains the priority of expanding domestic demand among its key tasks, calling for joint efforts to stimulate endogenous consumer momentum and implement consumption-boosting policies to drive sustained consumption growth. The Government Work Report set this year's economic growth target between 4.5% and 5%. The strong performance in the first two months lays a solid foundation for achieving the annual target.
"Looking at the released data, the overall performance is significantly better than market expectations, fully reflecting the strong vitality and resilience of the Chinese economy. We have every reason to be confident in China's economic development," stated Fu Linghui, spokesperson for the National Bureau of Statistics, offering reassurance. With a powerful start and a favorable beginning, the Chinese economy in the first year of the "15th Five-Year Plan" period is something to look forward to.
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