NBS: Q1 GDP Up 5% YoY! National Economy Off to a Good Start with Accelerating Industrial Production Growth

According to preliminary estimates by the National Bureau of Statistics (NBS), China's GDP in Q1 totaled 33,419.3 billion yuan, up 5.0% YoY in real terms, accelerating by 0.5 percentage points from Q4 of the previous year. By industry, the value added of the primary industry was 1,194.1 billion yuan, up 3.8% YoY; the value added of the secondary industry was 11,613.5 billion yuan, up 4.9%; and the value added of the tertiary industry was 20,611.7 billion yuan, up 5.2%. On a QoQ basis, GDP grew by 1.3% in Q1.

The National Economy Achieved a Good Start in Q1

In Q1, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, all regions and departments thoroughly implemented the decisions and plans of the CPC Central Committee and the State Council, stepped up the implementation of more proactive and effective macro policies, and worked to stabilize employment, enterprises, markets, and expectations. Efforts were accelerated to foster and develop new quality productive forces. Production and supply growth picked up, market demand continued to improve, the employment situation remained generally stable, market prices saw a mild rebound, high-quality development advanced toward new and better directions, the national economy achieved a good start, and development resilience and vitality were further demonstrated.

According to preliminary estimates, China's GDP in Q1 totaled 33,419.3 billion yuan, up 5.0% YoY in real terms, accelerating by 0.5 percentage points from Q4 of the previous year. By industry, the value added of the primary industry was 1,194.1 billion yuan, up 3.8% YoY; the value added of the secondary industry was 11,613.5 billion yuan, up 4.9%; and the value added of the tertiary industry was 20,611.7 billion yuan, up 5.2%. On a QoQ basis, GDP grew by 1.3% in Q1.

I. Agricultural Production Was in Good Shape, and the Livestock Industry Remained Generally Stable

In Q1, the value added of agriculture (crop farming) grew 3.7% YoY. The sown area of winter wheat remained stable, seedling conditions continued to improve, and spring plowing and preparation progressed smoothly. According to the national planting intention survey, the intended sown area for grain this year remained generally stable, with the rice area basically flat and the corn area stable with a slight increase. In Q1, the production of pork, beef, mutton, and poultry totaled 26.62 million mt, up 4.8% YoY, of which pork and poultry production increased by 4.2% and 9.3% respectively, while beef and mutton production decreased by 1.4% and 2.0% respectively; milk production increased by 3.4%, and egg production decreased by 3.1%. In Q1, hog slaughter reached 200.26 million heads, up 2.8% YoY; the quarter-end hog inventory stood at 423.58 million heads, up 1.5%.

II. Industrial Production Growth Accelerated, with Equipment Manufacturing and High-Tech Manufacturing Growing Rapidly

In Q1, the value added of China's industrial enterprises above designated size grew 6.1% YoY, accelerating by 1.1 percentage points from Q4 of the previous year. By three major sectors, the value added of the mining industry grew 6.0% YoY, manufacturing grew 6.4%, and the production and supply of electricity, heat, gas, and water grew 4.3%. The value added of equipment manufacturing grew 8.9% YoY, and that of high-tech manufacturing grew 12.5%, outpacing the overall value added of industrial enterprises above designated size by 2.8 and 6.4 percentage points, respectively. By economic type, the value added of state-owned holding enterprises grew 4.8% YoY; joint-stock enterprises grew 6.6%, foreign-invested and Hong Kong, Macao, and Taiwan-invested enterprises grew 3.9%; and private enterprises grew 6.1%. By product, the production of 3D printing equipment, lithium-ion batteries, and industrial robots grew 54.0%, 40.8%, and 33.2% YoY, respectively. In March, the value added of industrial enterprises above designated size grew 5.7% YoY and up 0.28% MoM. In March, the manufacturing PMI stood at 50.4%, up 1.4 percentage points from the previous month; the expectations index for enterprise production and business activities was 53.4%. In January–February, the total profits of industrial enterprises above designated size nationwide reached 1,024.6 billion yuan, up 15.2% YoY.

III. Services Sector Grew Rapidly, with Strong Momentum in Modern Services

In Q1, the value added of the services sector grew 5.2% YoY. Among them, leasing and business services, information transmission, software and information technology services, financial services, transportation, warehousing and postal services, and accommodation and catering grew 12.2%, 10.6%, 6.5%, 4.3%, and 4.3%, respectively. In March, the national services sector production index grew 5.0% YoY. Among them, the production indices of information transmission, software and information technology services, leasing and business services, and financial services grew 11.8%, 10.1%, and 6.7%, respectively. In January–February, the operating revenue of services enterprises above designated size grew 7.4% YoY. In March, the business activity index for the services sector was 50.2%, up 0.5 percentage points from the previous month; the business activity expectations index for the services sector was 54.8%. Among them, the business activity indices of railway transportation, telecommunications, radio, television and satellite transmission services, monetary and financial services, and insurance were in the relatively high prosperity range above 55.0%.

IV. Market Sales Picked Up, with Rapid Growth in Services Retail

In Q1, total retail sales of consumer goods reached 12,769.5 billion yuan, up 2.4% YoY, accelerating by 0.7 percentage points from Q4 of the previous year. By location of business units, urban retail sales of consumer goods reached 11,057.4 billion yuan, up 2.3% YoY; rural retail sales of consumer goods reached 1,712.1 billion yuan, up 3.1%. By type of consumption, retail sales of goods reached 11,307.2 billion yuan, up 2.2%; catering revenue reached 1,462.3 billion yuan, up 4.2%. Sales of basic living necessities and some upgraded goods grew relatively fast. On a YoY basis, retail sales of grain, oil and food, garments, footwear, hats, knitwear and textiles, communication equipment, and gold, silver and jewelry by units above designated size increased by 10.0%, 9.3%, 20.8% and 12.6% respectively. In March, total retail sales of consumer goods were up 1.7% YoY and up 0.14% MoM. In Q1, retail sales of services were up 5.5% YoY, with the growth rate on par with the full year of the previous year. Among them, retail sales of communication and information services, tourism, consulting and rental services, and culture, sports and leisure services grew relatively fast. In Q1, national online retail sales of goods and services reached 4,977.4 billion yuan, up 8.0% YoY. Of this, online retail sales of goods reached 3,161.4 billion yuan, up 7.5%, accounting for 24.8% of total retail sales of consumer goods; online retail sales of services reached 1,816 billion yuan, up 8.8%.

V. Fixed Asset Investment Grew Steadily, Infrastructure Investment Grew Relatively Fast

In Q1, national fixed asset investment (excluding rural households) reached 10,270.8 billion yuan, up 1.7% YoY, compared with a decline of 3.8% for the full year of the previous year; excluding real estate development investment, national fixed asset investment grew by 4.8%. By sector, infrastructure investment was up 8.9% YoY, manufacturing investment was up 4.1%, and real estate development investment was down 11.2%. The floor space of commercial buildings sold nationwide was 195.25 million m², down 10.4% YoY; sales of newly-built commercial buildings totaled 1,726.2 billion yuan, down 16.7%. By industry, investment in the primary industry was up 15.9% YoY, investment in the secondary industry was up 5.8%, and investment in the tertiary industry was down 1.0%. Private investment was down 2.2% YoY, with the decline narrowing by 4.2 percentage points from the full year of the previous year; excluding real estate development investment, private investment grew by 1.3%. Investment in high-tech industries was up 7.4% YoY, of which investment in computer and office equipment manufacturing, aerospace and aircraft equipment manufacturing, and information services grew by 28.3%, 19.0% and 20.9% respectively. In March, fixed asset investment (excluding rural households) was up 0.52% MoM.

VI. Trade in Goods Grew Rapidly, Trade Structure Continued to Optimize

In Q1, total value of goods imports and exports reached 11,838 billion yuan, up 15.0% YoY. Of this, exports reached 6,846.7 billion yuan, up 11.9%; imports reached 4,991.3 billion yuan, up 19.6%. Ordinary Trade imports and exports were up 9.0% YoY. Imports and exports to countries participating in the Belt and Road Initiative grew by 14.2%. Imports and exports of private enterprises grew by 16.2%, accounting for 57.3% of total imports and exports. Exports of electromechanical products grew by 18.3%. In March, total imports and exports reached 4,104.6 billion yuan, up 9.2% YoY.

VII. Consumer Price Increases Expanded, and Industrial Producer Prices Continued to Rebound

In Q1, the national consumer price index (CPI) rose by 0.9% YoY, with the increase expanding by 0.4 percentage points from Q4 of the previous year. By category, prices of food, tobacco, alcohol and dining out rose by 0.5% YoY, clothing by 1.8%, housing fell by 0.2%, household goods and services rose by 2.3%, transportation and communication fell by 1.1%, education, culture and entertainment rose by 1.0%, healthcare rose by 1.8%, and other goods and services rose by 14.1%. Among food, tobacco, alcohol and dining out prices, pork prices fell by 11.3%, grain prices fell by 0.3%, fresh fruit prices rose by 4.3%, and fresh vegetable prices rose by 7.6%. Core CPI, excluding food and energy prices, rose by 1.2% YoY. In March, the national CPI rose by 1.0% YoY and fell by 0.7% MoM.

In Q1, national ex-factory prices of industrial producers fell by 0.6% YoY, with the decline narrowing by 1.5 percentage points from Q4 of the previous year. Among them, March saw a YoY increase of 0.5%, compared with a decrease of 0.9% in the previous month; and a MoM increase of 1.0%. In Q1, the purchase prices of industrial producers nationwide fell by 0.5% YoY. Among them, March saw a YoY increase of 0.8%, compared with a decrease of 0.7% in the previous month; and a MoM increase of 1.2%.

VIII. The Employment Situation Remained Generally Stable, with the Urban Surveyed Unemployment Rate Unchanged YoY

In Q1, the average national urban surveyed unemployment rate was 5.3%, unchanged from the same period of the previous year. In March, the national urban surveyed unemployment rate was 5.4%. The surveyed unemployment rate for local household-registered labor force was 5.4%; the surveyed unemployment rate for non-local household-registered labor force was 5.3%, of which the surveyed unemployment rate for non-local labor force with agricultural household registration was 5.7%. The urban surveyed unemployment rate in 31 major cities was 5.3%. The average weekly working hours of employees in enterprises nationwide was 48.1 hours. At the end of Q1, the total number of rural migrant workers working outside their hometowns was 188.38 million, up 0.2% YoY.

IX. Household Income Continued to Grow, with Rural Residents' Income Growing Faster Than That of Urban Residents

In Q1, the national per capita disposable income was 12,782 yuan, a nominal increase of 4.9% YoY, or a real increase of 4.0% after deducting price factors. By place of permanent residence, the per capita disposable income of urban residents was 16,549 yuan, up 4.2% YoY in nominal terms and 3.2% in real terms; the per capita disposable income of rural residents was 7,433 yuan, up 6.1% YoY in nominal terms and 5.4% in real terms. By income source, the per capita nationwide wage income, net business income, net property income, and net transfer income grew 4.9%, 6.6%, 1.6%, and 5.1% in nominal terms, respectively. The median per capita disposable income of nationwide residents was 10,433 yuan, up 5.0% YoY in nominal terms.

Overall, major macro indicators rebounded in Q1, new momentum grew rapidly, and the national economy achieved a good start. However, it should also be noted that the external environment has become more complex and volatile, the domestic imbalance of strong supply and weak demand remains prominent, and the foundation for economic improvement still needs to be consolidated. In the next phase, it is important to adhere to the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, resolutely implement the decisions and plans of the CPC Central Committee and the State Council, fully and faithfully apply the new development philosophy, accelerate the construction of a new development paradigm, focus on promoting high-quality development, maintain the general principle of seeking progress while ensuring stability, implement more proactive and effective macro policies, continuously expand domestic demand and optimize supply, improve incremental resources and revitalize existing assets, and make efforts to stabilize employment, enterprises, markets, and expectations, so as to continuously consolidate and expand the steady and positive momentum of the economy.