China's GDP up 8.1% in 2021

China’s gross domestic product (GDP) expanded 8.1% year-on-year to CNY114.37 trillion last year, the National Bureau of Statistics (NBS) said. Two-year average growth was 5.1%. The economy grew by 4% in the fourth quarter of last year, slowing from the 4.9% growth in the previous three months, bringing the full-year growth rate to 8.1. China set an economic growth target of “above 6%” for 2021 during the National People’s Congress (NPC) in March last year. China’s economy grew by a revised 2.2% year-on-year in 2020 under pressure from the coronavirus. China’s central bank cut the rate on its one-year policy loans to 2.85% – the first drop since early 2020 at the height of the pandemic – and a clear signal that the year’s outlook remains uncertain. Final consumption contributed 65.4% to the GDP expansion, while net exports contributed 20.9%, said NBS Director Ning Jizhe at a press conference. China’s GDP is expected to account for more than 18% of the global total.

According to the NBS, industrial production grew 9.6% last year. Retail sales grew by 1.7% last month compared with a year earlier, down from 3.9% in November. Overall in 2021, retail sales grew by 12.5%. Per capita disposable income reached at CNY35,128, up 9.1% year-on-year in nominal terms. Fixed-asset investment (FAI) rose by 4.9% last year. The country’s per capita GDP stood at USD12,551 last year, approaching the World Bank’s threshold for a high-income country. Meanwhile, China’s research and development (R&D) expenditure rose 14.2 % year-on-year last year, four percentage points higher compared to the previous year, accounting for 2.44% of GDP. Last year, investment in high-tech industries increased by 17.1%, 12.2 percentage points faster than total investment.

China’s population on the mainland has grown to 1.4126 billion by the end of last year, up by 480,000 compared with the end of 2020. The figure does not include Hong Kong, Macao, and Taiwan residents and foreigners who live in the mainland. China’s population living in urban areas on the mainland increased by 12.05 million from the end of 2020 to 914.25 million by the end of 2021, representing 64.72% of the total. China's birth rate hit a record low at 7.52 births per 1,000 people.

Last year, Dongguan in Guangdong province became the 24th city on the Chinese mainland to record a GDP over CNY1 trillion. In 2021, Beijing became the first Chinese city to have a GDP exceeding CNY4 trillion. Shanghai was the first Chinese city to hit the CNY1 trillion mark in 2006, followed by Beijing in 2008. “China’s rapidly growing urban economy has become a key pillar supporting the country’s economic development,” said Pan Helin, Executive Director of the Digital Economy Academy of Zhongnan University of Economics and Law. Shanghai is expected to join Beijing with a GDP over CNY4 trillion in 2021. Among the 24 cities, 18 are located in southern China and 6 in the northern region. Zheng Lei, Chief Economist at Glory Sun Financial Group, said the 24 cities accounted for around 40% of China’s overall GDP, showing the remarkable role urban economies play in supporting the country’s overall development.

China’s foreign trade reached USD6.05 trillion in 2021, setting a new historic record following a previous high of USD4 trillion in 2013, according to the General Administration of Customs. In renminbi terms, the total foreign trade in 2021 was CNY39.1 trillion, surging 21.4% from a year earlier. Exports were CNY21.73 trillion, up 21.2% year-on-year, while imports expanded by 21.5% on a yearly basis to CNY17.37 trillion. “But export growth in 2022 will likely become more moderate due to the high comparison base and weaker overseas demand”, Li Kuiwen, GAC Spokesman and Director General of the Statistics and Analysis Department, said.

China’s economy is expected to grow around 5.5% in 2022, bringing the average annual growth rate forecast for 2020 to 2022 to 5.34%, according to the Center for Forecasting Science (CEFS) of the Chinese Academy of Sciences (CAS). Bao Qin, Assistant Director of CEFS, said China’s GDP growth rate is expected to reach around 5.2% in the first quarter of 2022, with the second and third quarters expected to be 5.5% and 5.6%, respectively. Fourth quarter GDP is likely to grow by 5.7%. “Domestic consumption is expected to maintain sustained growth in 2022, with a year-on-year nominal growth rate of 5.4% to 7%, which will still be the main driving force for economic growth,” Bao said at a news conference in Beijing. The nominal growth rate of fixed asset investment (FAI) is expected to be 5% to 6% in 2022. The country’s imports and exports are likely to surge more than 6% year-on-year to reach USD6.41 trillion in 2022, with exports and imports increasing nearly 7% and over 5%, respectively, the forecasts showed. The consumer price index will rise around 2% in 2022.

This overview is based on reports by the South China Morning Post, China Daily, Global Times and Shanghai Daily.