July 15 (UPI) -- China's economy delivered steady progress in 2024, bucking slowdowns in the retail and property sectors to grow at an annual pace of 5% in the six months to the end of June, the Chinese government said Monday.
The "generally stable" performance saw second quarter GDP slow to 4.7% from 5.3% in the January to March period, despite a strong 6% surge in industrial production, due to weaker domestic demand data, according to the latest economic bulletin from the National Bureau of Statistics.
The GDP report for the world's second-largest economy, which is down from 5.5% in the first half of 2023 but in line with the 5% target set by Beijing, came as the Chinese Communist Party's policy-making central committee gathered in Beijing for its third plenum.
Retail sales growth slumped from 8.2% in the first half of 2023 to 3.7% in the January to June period this year as consumer confidence faltered. Most of the growth came from strong online retail sales, retail sales of services and catering.
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In June, total retail sales of consumer goods were up 2% over June 2023 but fell 0.12% from May.
The surge in industrial production was led by growth in value-added equipment manufacturing and value-added high-tech manufacturing, up by 7.8% and 8.7% respectively, in line with a focus on "high-quality development" such as AI, electric cars and green energy.
Pursuing stable progress through modernizing and implementing macro policies and regulations had produced "a steady of increase production, sustained recovery of demand, generally stable employment and prices, continued increase of household income" amid an acceleration in growth from "new driving forces" and the successes delivered by "high-quality development," the bureau said.
However, first-half investment growth in fixed assets -- plant, equipment and property -- grew just 0.1% to 3.9% from the same period in 2023, principally driven by manufacturing and, to a lesser extent, infrastructure. However, overall fixed assets growth would have come in at 8.5% had it not been for a massive 10.1% slump in investment in real estate development.
China is experiencing a property crash after a massive speculative bubble burst leaving millions of empty apartments and houses and half-finished projects. Heavily-indebted developers who borrowed big to cash in on the boom are struggling to service their debts, leading to some defaulting.
Evergrande, one of the largest, was placed into liquidation in January by a court in Hong Kong after the company repeatedly failed to come up with a viable plan to restructure liabilities of at least $325 billion. Investors have also sought to wind up others, including Country Garden and Shimao, the latter by a Chinese state-owned bank.
