SCIO briefing on China's economic performance in Q1 2025

Shou Xiaoli:

We will now begin the Q&A session. Please state the news organization you represent before asking your question.

CCTV:

We've just reviewed the released data as well. Overall, the key economic indicators performed well in the first quarter. How would you assess the first quarter's overall economic performance? What were the main contributing factors? Thank you.

Sheng Laiyun:

Thank you for your question. Since the beginning of this year, the international environment has been marked by intertwined turbulence and change, with adverse effects deepening. Domestically, the pains of structural adjustment persist, and many enterprises are experiencing considerable operational difficulties. In the face of this complex situation, the CPC Central Committee has made sound decisions. All regions and departments across the country have earnestly implemented the spirit of the Central Economic Work Conference and the arrangements set out in the government work report. With unity and determination, they have accelerated the implementation of proactive and effective macroeconomic policies and responded forcefully to external challenges. As a result, the national economy got off to a steady and promising start in the first quarter, with high-quality development showing new and positive momentum. The statistical data highlights several notable features.

First, growth has remained stable with a steady upward trend. In the first quarter, GDP grew by 5.4% year on year, surpassing last year's national growth rate of 5% and the 5.3% growth rate in the first quarter of last year. This places China among the top performers globally and continues the steady, positive momentum and gradual recovery trend seen since last year. Production and demand indicators have rebounded at a faster pace. The total value added of industrial enterprises grew 6.3%, up 0.6 percentage point over last year's annual figure. The value added of the service sector rose 5.3%, up 0.3 percentage point. Fixed-asset investment grew 4.2%, improving 1 percentage point, while total retail sales of consumer goods increased 4.6%, a rebound of 1.1 percentage points.

Second, employment and income have remained generally stable. In the first quarter, the national surveyed urban unemployment rate was 5.3%. In March, the rate was 5.2%, down 0.2 percentage point from the previous month. After adjusting for price factors, nationwide per capita disposable income grew 5.6%, roughly in line with GDP growth.

Third, the balance of international payments remained healthy. In the first quarter, global economic growth momentum was relatively weak, but China's imports and exports remained generally stable. The total value of goods trade imports and exports grew by 1.3% year on year, with exports increasing 6.9%. From January to February, service trade imports and exports rose 9.9%. By the end of March, foreign exchange reserves remained above $3.2 trillion. This was no easy feat. Since February, international trade restrictions have increased, yet exports have maintained a growth rate of 6.9%, highlighting the resilience of China’s export sector.

Fourth, high-quality development is showing new and positive momentum. While achieving reasonable quantitative growth, the cultivation and expansion of new quality productive forces have gained momentum, and the overall trend toward high-quality development in new and positive directions remains unchanged. Numerous scientific and technological breakthroughs have continued to emerge, driving rapid first-quarter growth in high-tech industries. In the first quarter, the value added of high-tech manufacturing enterprises above designated size increased by 9.7% year on year. Green development has continued to sustain progress. In the first quarter, the share of non-fossil energy in total energy consumption increased by 1.5 percentage points year on year. High-level opening up has continued to make steady progress, and efforts to ensure people's wellbeing have been consistently intensified.

Fifth, market vitality and confidence have increased. The combined impact of previously introduced macroeconomic policies and this year's expanded incremental measures has effectively boosted demand, promoted production, stimulated vitality and strengthened confidence. In March, the manufacturing PMI was 50.5%, up 0.3 percentage point from the previous month, marking the second consecutive month of recovery. Several physical indicators show that the role of production factors in supporting growth is strengthening. In the first quarter, freight volume increased at a faster pace year on year. By the end of March, the balance of renminbi loans grew 7.4%, while aggregate social financing increased 8.4%, providing strong and effective support for the economy's recovery and growth.

The economy got off to a strong start in the first quarter, with high-quality development showing new and positive momentum, underscoring the strong resilience and potential of the Chinese economy. The strong start in the first quarter was primarily due to the forward-thinking, decisive and scientific leadership of the CPC Central Committee with Comrade Xi Jinping at its core, along with the united efforts and hard work of people across the country. On Sept. 26 last year, the meeting of the Political Bureau of the Central Committee of the Party decisively rolled out a package of incremental policies that played a key role in stabilizing the economy. The Central Economic Work Conference then called for more proactive and effective macroeconomic policies. Since the beginning of this year, policy measures have been expanded and strengthened, with both existing and new policies working together to help the economy get off to a strong start in the first quarter. Second, all regions and departments have diligently implemented the decisions and plans of the CPC Central Committee, taking early and concrete action, seizing opportunities for a strong start and for boosting exports, and making full use of favorable conditions, which has effectively driven the rebound in production and demand. Third, China has vigorously promoted the deep integration of technological innovation and industrial innovation. Scientific and technological advances continue to emerge, with their transformation and application accelerating and fueling the steady growth of new economic drivers.

While fully acknowledging these achievements, we're also keenly aware that the external environment is becoming increasingly complex and severe. Global trade protectionism is rapidly intensifying, the world economic order is under significant strain, and the domestic challenge of structural transformation remains considerable. Therefore, sustaining the economy's recovery and growth will require even greater efforts. We must closely unite around the CPC Central Committee, strengthen our confidence, build consensus, actively respond to risks and challenges, and focus on managing our own affairs. By ensuring stable growth and high-quality development, we can meet external uncertainties with the certainty of our own progress, ensuring that China's economy continues to advance steadily and sustainably. Thank you.