The Chinese economy maintained stable expansion in the first half of 2024, with more than half of all provincial-level regions showing a stepped-up recovery. A total of 16 of China's 31 provincial-level regions reported a GDP growth rate higher than the national average of 5% in the first half. Inner Mongolia took the lead with a GDP growth of 6.2%, followed by Chongqing and Tibet at 6.1%, according to data released by local governments. The two provinces with the highest GDP were Guangdong and Jiangsu, with their GDP exceeding CNY6 trillion each. In the first six months, the Beijing-Tianjin-Hebei region in North China, East China's Yangtze River Delta region and nine Chinese mainland cities within the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) generated a total output of CNY25.5 trillion, accounting for about 41.6% of the national total economic output.
The growth of high-tech manufacturing and new quality productive forces has been increasing. For example, investment in advanced manufacturing and high-tech manufacturing in Guangdong rose by 18.6% and 23.9%, respectively. In Shanxi province, the investment in high-tech manufacturing jumped by 50.6% and investment in new energy power generation rose by 34.9%. The Greater Bay Area has become a locomotive engine leading China's economy, as the in-depth integration of digital technologies and the real economy has given birth to new industries and new business models that dominate these regions' growth, Cao Heping, Economist at Peking University, told the Global Times. Zhou Jingtong, Deputy Dean of the Bank of China Research Institute, attributed the remarkable performance of the central and western regions to policy support, complete infrastructure, and comparatively lower labor costs. “Take Yibin city in Sichuan for example. Previously, Yibin was famous for producing Chinese baijiu, but now the new energy industry booms in the city, underscoring the positive impact of industrial transfer,” he said. China's coastal cities face pressures to maintain a relatively high GDP growth rate. These regions should enhance efforts to accelerate the development of new quality productive forces to counter the negative impact of the restructuring of global industrial chains, according to Zhou.
Recently, the People's Bank of China (PBOC) cut several major short and long-term interest rates, including one-year loan prime rate (LPR) and five-year LPR, in a fresh move to strengthen counter-cyclical adjustments and increase support for the real economy. Growth in China's services activity picked up in July as employment expanded at the quickest pace in nearly a year, according to the Caixin China General Services Business Activity Index, which provides an independent snapshot of operating conditions in sectors such as retail and tourism. The index rose 0.9 points to 52.1 in July, coming off an eight-month low. “In the second half, the Chinese economy is expected to rebound following the implementation of a series of policies,” said Yang Delong, Chief Economist at Shenzhen-based First Seafront Fund, calling for confidence and patience for the Chinese economy, the Global Times reports.
