China: Economic growth, population decline

China’s economy has been recovering slowly since the end of zero-Covid policies in late 2022.

os | Ipsos Almanac 2024 | China

China’s economy has been recovering slowly since the end of zero-Covid policies in late 2022.   

In 2023 Q1, with greater hope and higher expectations, business activities and consumer confidence surged for a short period after the Chinese New Year. Expenditure on FMCG was expected to increase, but one-time large purchases were more made cautiously (Ipsos China: Optimism and Anxieties during Covid-19 Outbreak wave 5).   

In Q2 and Q3, the economy recovered more slowly than expected. China’s Q2 GDP achieved 6.3% growth, but this was based on a soft Q2 in 2022, due to the lockdown in Shanghai and many other cities. 

China started Q4 with an eight-day national holiday and domestic tourism income increased by 1.5% compared to 2019.The tourism is one of the fastest recovering sectors in 2023. 83.1% consumers plan to travel 2-5 times in the coming year (Ipsos China: Insights on the Tourism Industry for 2023). 

The macro economy data indicated a stabilized economy growth and a glimmer of hope. The Manufacturing PMI (Purchasing Managers’ Index, released by National Bureau of Statistics) increased to 50.2% in September, indicating expansion for the first time since April 2023.   

It is noteworthy that China has a very low inflation rate with the CPI YoY growth close to 0.1%. Comparing to global markets, China has the highest proportion of people thinking inflation has already returned to normal. Although the central bank has been on the track of monetary easing for many quarters, decision makers are still cautious about spending or investing. 

Weak Property Sector and Strong Automobile Growth  

The property market has been weak in 2023, and heavy debt is a key issue in the sector. The government is set to take further actions to revive the sector and to tackle the debt issues. It will take further time to decide how successfully China will manage the property sector, but there’s no doubt that the policies and growth model will change fundamentally.  

China is looking for new growth boosters, and the automobile sector has great potential. In 2023 Q1, China became the world’s largest automobile exporter for the first time. Among the exported vehicles, 30% were new energy vehicles (NEV). China’s automobile manufacturing increased by 11.7% YoY in the first eight months of 2023, and NEV increased by about 79%.  


After ChatGPT was released, China’s internet giants immediately followed. Baidu soon launched its own LLM (Large Language Model) ERNIE Bot, and Alibaba launched Tongyi. More AI players are investing in developing apps powered by AI. As one of the most discussed topics in 2023, the potential of AI-driven business growth has started to reveal itself.  


In 2022, China saw a decrease in population for the first time in decades. The birth rate fell below the replacement rate of 2.1 in 1991 and has been decreasing ever since. By 2023 Q1, the birth rate reached 1.07, making China the country with the second lowest birth rate in the world. In 2013, there were 17.7 births in China. In 2022 this number fell to 9.6 million. By the end of 2023, it is estimated that there will be fewer than 8 million. 

Lifeng Liu

Country Manager, Ipsos in Greater China