THE International Monetary Fund (IMF) on Tuesday upgraded its 2023 gross domestic product growth (GDP) forecast for China to 5.4% from 5%, citing a strong post-COVID-19 recovery.

“The Chinese economy is on track to meet the government’s 2023 growth target, reflecting a strong post-COVID recovery,” according to a statement made by Gita Gopinath, IMF’s first deputy managing director, following a visit to China.

GDP growth could slow to 4.6% in 2024 because of weakness in China’s property sector and subdued external demand, the IMF said, albeit better than its October expectation of 4.2% in the IMF’s World Economic Outlook (WEO).

The upward revision followed a decision by China to approve a 1 trillion yuan (US$137 billion) sovereign bond issue and allow local governments to frontload part of their 2024 bond quotas, in a move to support the economy.

“These projections reflect upward revisions of 0.4 percentage points in both 2023 and 2024 relative to October WEO projections due to a stronger-than-expected third-quarter outturn and recent policy announcements,” said Gopinath in the statement.

China has introduced numerous measures to support the property market, but more is needed to secure a quicker recovery and lower economic costs during the transition, she said.

China’s GDP expanded 4.9% in the third quarter, up 1.3%  from a quarter ago. It grew 5.2% year on year in the first three quarters of 2023, according to the National Bureau of Statistics.

China only needs GDP growth of 4.4% in the fourth quarter to meet its annual growth target of around 5%.  (SD-Agencies)