CHINA In 2022, China’s GDP grew less than half that of India’s

Beijing’s economy posted +3%, Delhi’s +7%. The effects of Xinping’s zero covid policy and the drop in global demand. India is more dependent on domestic consumption. China is aiming for a recovery this year, but a superboom is unlikely. US companies operating in the Chinese market are pessimistic.

Beijing () – Last year the Chinese economy grew by 3%, less than half that of India, which the latest projections put at 7%, according to a comparison between the data just published by the Institute National Statistics Office of China and that of Delhi.

The Chinese government’s target for 2022 was 5.5% GDP growth. Indian experts told Nikkei Asia that China’s slowdown is due to the country’s strict anti-Covid regulations that were in place until December and Beijing’s reliance on exports, at a time when global demand has fallen due to the effects of the Russo-Ukrainian war and high energy costs.

By contrast, India fared better because it is “less integrated” into the world economy and more dependent on domestic demand. Since the pandemic broke out three years ago and the escalation of the trade and technology war with the US, Xi Jinping has focused on strengthening domestic demand, but so far with mixed results.

In real terms, per capita spending in China fell 0.2%, after posting 12.6% growth in 2021, but the baseline was very low due to the covid spike the previous year. This is only the third drop since 1980, when authorities began publishing these types of statistics. Retail sales, the measure of domestic consumption, also contracted 0.2%: the second worst figure since 1968.

More significant still is the collapse of urban jobs in the country, the first recorded since 1962, immediately after the famine caused by the “Great Leap Forward”, the disastrous economic policy implemented by Mao Zedong between 1958 and 1961. Last year China lost 8.4 million jobs in cities, stopping at a total of 459.3 million.

Xi’s draconian “covid zero” policy weighs on employment, added to the contraction of the labor force due to the aging of the population and the slowdown in the growth of migrant workers who move from the countryside to the cities.

With the lifting of sanitary restrictions, an acceleration of the Chinese economy is expected. However, many analysts believe that it will not be a superboom, as predicted by some observers at the beginning of the year. After 19 months of decline, the sale of new homes grew again in February; activity in the industrial and service sectors also grew last month.

However, a survey by the US Chamber of Commerce in China shows that US companies operating in the country are more pessimistic about their prospects. The study reveals that, for the first time in 25 years, American companies no longer rank the Chinese giant among their top three investment priorities. They fear geopolitical tensions between Washington and Beijing and an even more closed and regulated local market as a result of efforts to centralize power in the hands of Xi and the Communist Party of China.