Apr 2

China Business News: Provincial Cities Show Economic Growth After COVID-19 Relaxations

Editorial Staff
Jan 27, 2023
China business
Image: Phuong Uyen Vo Hoang via Unsplash

Welcome to China Business News, NEO’s weekly roundup of top business developments as reported by news outlets in China and the region.

This week’s highlights:

  • 31 provincial municipalities in China published data on their economic growth over the previous year in the run-up to the country’s weekling Spring Festival, which began on 22 January. The data highlighted the positive impact of epidemic prevention and control measures on the local economy. Analysts believe that with the shift in China’s policy regarding COVID-19, any new lockdowns appear unlikely. But with major Western economies falling into recession, external demand is likely to be weak this year. This will bring new challenges to economic growth in major export provinces such as Guangdong, Jiangsu and Zhejiang. (The United Morning Post)
  • In 2023, China’s commercial residential sales are expected to decline by about 10% year-over-year. This view was recently presented at an analysis session by Lin Zhenhong, head of real estate investment research at the UBS Mainland/Hong Kong office. According to China’s National Bureau of Statistics, the country’s commercial residential sales in 2022 accounted for about 1 bln square meters, down 27% year-on-year. China’s long-term housing demand will shrink to 928 million sq m/year by 2030. The significant contraction regarding new construction  directly affects real estate supply. According to Caixin, throughout 2022, the new supply in big cities’ property markets generally fell by about 40% year-on-year. Notably, 50% of the top 100 real estate enterprises basically suspended land acquisition. Analysts say that the overall property market supply will continue to decline in the first half of 2023. (Caixin)
  • The impact of the U.S. government’s escalating export controls on semiconductor technology to China has negatively affected the American semiconductor equipment giant Lam Research. According to its financial report, the percentage of revenue from mainland China has dropped to 24% in the fourth quarter, a decrease of 6% from the previous quarter. Based on that percentage, Panlin’s revenue in mainland China now accounts for $1.3 billion, a decline of nearly 17% from the previous quarter. (Caixin)
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