Analysts at Goldman Sachs said the year-on-year increase in the fourth quarter was “thanks mainly to a low base” from 2022.

“The result was broadly in line with expectations and confirms that the economy slightly bettered the ‘around 5 per cent’ growth target for the year,” said Harry Murphy Cruise, an economist at Moody’s Analytics.

But despite China hitting its annual growth target, “the year didn’t pan out how officials had hoped”, Cruise observed.

“China’s struggles across 2023 were epitomised in the final-quarter GDP data,” he said. “Growth was nothing to write home about, and the recovery was uneven across the economy.”

2. Property investment continues to drag

Property investment in China, which has been a major drag on the nation’s post-Covid recovery, fell by 9.6 per cent for all of 2023, after having dropped by 9.4 per cent in the first 11 months of the year.

The property slump also affected the recovery of the private sector, which is a backbone of growth and job creation, as the sector’s investment fell by 0.4 per cent in 2023, compared with a fall of 0.5 per cent in the first 11 months of last year.

3. Retail sales growth slows ‘notably’

China’s retail sales growth slowed to 7.4 per cent in December, from 10.1 per cent a month earlier, while retail sales in 2023 grew by 7.2 per cent compared with a year earlier.

“Retail sales growth fell notably in year-on-year terms in December and missed expectations, driven mainly by slower automobile and home appliance sales growth, although year-on-year growth in Covid-sensitive restaurant sales rose further thanks to favourable base effects,” said analysts at Goldman Sachs.

4. Fixed-asset investment accelerates ‘modestly’

Fixed-asset investment in China, which includes spending on factory equipment, construction and infrastructure projects that help drive economic growth, grew by 3 per cent, year on year, in 2023.

“Fixed-asset investment growth accelerated modestly in December, slightly above the consensus but in line with our forecast, thanks to the ongoing fiscal easing despite still-depressed property investment,” added analysts at Goldman Sachs.

5. Industrial production growth ticks up

Industrial output in China picked up in December after expanding by 6.8 per cent, up from a rise of 6.6 per cent a month earlier.

Overall, the gauge grew by 4.6 per cent last year.

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“Year-on-year industrial production growth ticked up in December and slightly beat market consensus, partly driven by stronger growth in automobile production amid solid automobile exports and a low base, while year-on-year output growth of steel products and cement slowed,” said analysts at Goldman Sachs.

6. Youth-unemployment rate returns, with a twist

The National Bureau of Statistics said the new rate did not include students to “more accurately reflect the employment and unemployment status of the youth who are in need of a job after graduation”.

China’s youth-unemployment rate returns, stands at 14.9% when adjusted

China’s urban surveyed unemployment rate, meanwhile, stood at 5.1 per cent in December, up from 5 per cent in November.

7. Will 2024 be ‘another year to forget’ for China?

Moody’s Analytics expect China’s economy to expand by 5 per cent in 2024 as long as extra government support is rolled out and there is a slowdown in the fall in the property market.

An uptick in the global economy through the second half of the year is also needed, otherwise, “2024 could be another year to forget” for China’s economy, they added.

“The success of 2024 will largely be driven by how effective officials are in turning the property market around. Absent the monster spending splurge of years gone by, real estate investment, dwelling prices and new dwelling sales are set to fall throughout 2024. Come 2025, we expect the market to return as a modest driver of growth – albeit far short of its glory days preceding 2021,” said Cruise from Moody’s Analytics.

Analysts at Capital Economics said that, despite China meeting its GDP growth target for 2023, achieving the same pace of expansion in 2024 could prove a lot more challenging.

“The headline GDP figures notwithstanding, we think the data is consistent with a slight improvement in momentum recently,” they said. “But the recovery clearly remains shaky.

“And while we still anticipate some near-term boost from policy easing, this is unlikely to prevent a renewed slowdown later this year.”

Louise Loo, lead economist at Oxford Economics, said that maintaining the current growth momentum of around a 1 per cent sequential pace would require ongoing and coordinated stimulus measures over the next few quarters.