President Xi admits ‘tough times’ for some companies and jobs

• Chinese leader Xi Jinping acknowledged China’s economic challenges in a speech on Sunday.
• He acknowledged that businesses are going through “tough times” and people are having “difficulty finding work”.
• Factory activity shrank for the third consecutive month in December, according to a survey of manufacturers.

China’s economy has struggled to make a convincing recovery. Even Chinese leader Xi Jinping now acknowledges the many challenges facing China’s economy in 2023.

“Some businesses have suffered. Some people have had difficulty finding work or meeting their basic needs,” Xi said in his 2024 speech on Sunday, according to official records. said. He also described the challenge as a “headwind.”

According to CNN, this is the first time President Xi has talked about economic difficulties since he began delivering New Year’s addresses in 2013.

Despite a rare frank acknowledgment of China’s economic woes, Mr. Xi spent much of his speech touting China’s victories, praising its sustainable industrial progress and the resurgence of domestic tourism.

China’s economy grew 3.0% in 2022, the worst in half a century, as the country battles strict regulations during the coronavirus pandemic and a real estate crisis dragged into 2023. grew by 3.0%. Stimulus measures are necessary, but analysts say they are not enough.

Xi’s speech came as an official survey of Chinese manufacturers showed factory activity contracted for the third consecutive month, with the country’s Purchasing Managers’ Index falling to 49 in December, the lowest in six months. It was done a few hours later.

Nomura economists said in a note Tuesday that China’s underlying growth momentum is likely to remain “lackluster.”

“Despite a series of recently announced economic stimulus measures, it is still too early to bottom out, and a weak real estate sector, pent-up demand disappearing, and weak external demand could cause the economy to slump again in spring 2024. “There is a lot of potential,” the Nomura economists wrote, “overcapacity in some ‘green’ sectors, and persistent geopolitical headwinds.”