CHINA’S economy grew faster than expected in the first three months of the year, even as countries around the world feel the impact of the US-Israel war with Iran.
Gross domestic product (GDP) rose by five per cent in the period, compared to a year earlier, according to official data.
Economists had expected the figure to come in at around 4.8 per cent.
That came despite the conflict in the Middle East, which started on February 28, severely disrupting global energy supplies, with Asian countries hit particularly hard.
It also marks the first release of official GDP figures since Beijing cut its annual economic growth target last month to a range of 4.5 per cent-five per cent, its lowest expansion goal since 1991.
The rebound from a weaker expansion of 4.5 per cent in the previous quarter was driven by manufacturing, while the world’s second largest economy continues to be weighed down by falling property investment.
Cars and other exports were a “major bright spot” in the data, said Kyle Chan, an analyst from the Brookings Institution.
The Iran war’s full effects are yet to be seen, Chan said, adding that next quarter’s GDP figure is likely to be weaker due to trade disruptions caused by the conflict.
China’s latest GDP target and economic objectives were announced in March under its latest Five Year Plan.
Beijing also pledged to invest heavily in innovation, high-tech industries and efforts to boost domestic spending.
The ruling Communist Party is trying to reshape the country’s economy, which has been struggling with a number of issues including weak consumption, a shrinking population and a prolonged property crisis.
From abroad, China also faces an energy crunch due to the Iran war and global trade tensions, including US President Donald Trump tariffs policies.
China currently faces a 10 per cent US tariff for most of its goods.
However, US Treasury Secretary Scott Bessent said on Tuesday that the levies may be restored by the beginning of July to the levels in place before the Supreme Court struck down many of the import taxes.
On Tuesday, China published monthly export numbers for March, which showed a sharp slowdown in growth as the conflict pushed up inflation and curbed consumer spending.
China’s export growth slowed sharply to 2.5 per cent last month compared to the same time last year, according to data released on Tuesday by the General Administration of Customs.
It marks a six-month low and comes after the combined exports for January and February jumped by more than 20 per cent compared to a year before.
—BBC
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