Residents and tourists enjoy nighttime activities such as shopping and cultural performances at Wanshou Palace commercial street in Nanchang, East China's Jiangxi Province, on February 18, 2023. As the weather warms up, the streets and alleys in Nanchang have become more lively, and the nighttime economy is helping to drive urban consumption. Photo: VCG

Kang Yi, head of the National Bureau of Statistics Photo:VCG

China's economic rebound is foreseeable, with growth of about 5 percent fully achievable, backed by multiple factors including a strong domestic consumption revival in the first quarter of 2023, Kang Yi, head of the National Bureau of Statistics (NBS), told a press conference during the two sessions, on Sunday.

The remarks highlight the central government's full confidence and determination to bring the world's second largest economy back on track, which adds a more positive outlook to the world economic recovery amid mounting uncertainties, observers said.

While briefing the media about China's economic growth this year, Kang said he is fully confident that the overall economic operation will improve and the expected growth rate of around 5 percent will be achieved, based on the judgment of the nation's fundamentals of economic development.

"China is still a developing country, and there is still a big gap between the per capita level and the developed countries of the world, and there exists a huge growth potential," Kang said.

He also noted the obvious advantages of China's ultra-large market, which holds sufficient labor supply and good production factors, indicating the fundamentals of long-term improvement have not changed.

Reviewing 2022, the tough year of incessant epidemic flare-ups and external challenges, China's economy secured 3.0 percent growth, higher than 2.1 percent for the US, Japan's 1.0 percent and Germany's 1.8 percent.

China's consumer price index (CPI), a main gauge of inflation, grew by merely 2 percent in 2022, a mild increase, which stood in stark contrast with the elevated inflation in many developed countries, according to the NBS.

Leading indicators of China's economy have also shown growing signs of improvement. For example, the volume of railway freight, power generation and the balance of yuan loans all grew steadily.

The NBS said China's official manufacturing PMI in February rebounded by 2.5 percentage points to 52.6, hitting an 11-year high, which shows that market players are upbeat in the growth potential in 2023 and beyond.
 
China's changing economic outlook has added positive factors for the world economy too.

"Since February, many international organizations have become less pessimistic about the world economy, and have also raised their forecasts for world economic growth in 2023 because of China's rapid recovery," Kang said.

Experts said that Kang's remarks sent a positive message about the market recovery trend for China and the world, and it again highlighted the government's confidence in stabilizing economic growth this year, despite challenges.

Judging from various indicators in the past two months, the recovery trend is obvious, such as domestic consumption and investment, Li Chang'an, a professor at the University of International Business and Economics, told the Global Times on Sunday.

Li expects a stronger economic recovery starting the second quarter this year, with expanding market demand becoming the main driver of the growth. 

"Judging from the current situation, the most severely hit industries in the past three years, including tourism and catering, have bounced back the fastest, which may continue to provide a more vigorous pulling effect for the rest of the year," said Li. The services sector also provides the most jobs.

But lingering external and internal challenges may affect a full economic recovery, as Kang also noted at the press briefing on Sunday.

The development environment is complicated, and there are still deep-seated and structural problems in the domestic economy, he said, such as employment difficulties and slow income growth.

The pressure on China from the unrelenting US "decoupling" attempt may also escalate, experts said.

US moves to decouple from China in technology would cause disruptions to normal global supply chain. 

And, the radical US monetary tightening, especially the steep interest rate hikes by the US Federal Reserve, may overshadow the economic recovery, Dong Dengxin, director of the Finance and Securities Institute of the Wuhan University of Science and Technology, told the Global Times on Sunday.