China Q3 Report 2022

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After having been delayed for nearly a week due to the Chinese Communist Party Congress, there was a lot of speculation around the quarterly results and what they may reflect. The Q3 results for 2022, which were released on the morning of the 24th of October, reflected a sharp rebound in the GDP, faster than originally anticipated by analysts.

From July to September the Chinese economy experienced a 3.9% growth rate year-on-year, which had far exceeded the 0.4% growth experienced over Q2. Despite the positives illustrated by the growth, there are still a number of challenges that pose a risk to economy in the near future.

China is still battling to contain COVID-19, while the zero-COVID measures continue to put a strain on businesses and individuals. Additionally, China is faced with multiple geo-political issues and difficulty in the property market, which is a key sector in the economy, still remains. Despite the challenges Chinese leaders still maintain that the economy will remain strong in the long run.

­­Gross Domestic Product in the Third Quarter

China’s GDP growth from July to September stood at 3.9%, which is a sharp rebound from the 0.4% growth that was experienced in Q2. Up to this point the GDP over the first 3 quarters had reached just over RMB 87 billion, which was up by 3% year-on-year.

Unemployment Sees a Decrease

The unemployment rate for Q3 averaged 5.4% which is 0.4% lower than unemployment seen in the previous quarter. The surveyed unemployment rate in September reached 5.5%, which is 0.2% higher than it was August.

Purchasing Managers Index

The Purchasing Manager Index (PMI) is a metric used to weigh the performance of large enterprises based on the criteria of production, new orders, supplier deliveries, and inventory levels and production. A figure of 50 demonstrates no change, while a figure higher or lower than 50 indicates relative increases or decreases in performance.

In September the Purchasing Managers Index saw an increase of 0.7% from the previous month, allowing it to stand at 50.1%.

Increase in Retail Sales Assists Yearly Average

While in Q2 total retail sales of consumer goods experienced a 4.6% decrease from the previous year, Q3 illustrated a strong rebound at a *** y-o-y increase. Collectively for the first 3 quarters total retail sales saw a slight y-o-y increase at 0.7%

Recovery Seen in Industrial Production

The total value added of industrial enterprises above the designated size saw growth of 3.9% year-on-year over the first 3 quarters of 2022. Specifically, in Q3 the value added of industrial enterprises saw a 4.8% increase year-on-year, which is 4.1% more than that of Q2.

In terms of sector specific growth, the high-tech manufacturing sector saw an 8.5% increase. The total value of mining increased 8.5% year over year and manufacturing saw a growth rate of 3.2%.

Understanding China’s Business Landscape

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