China has likely seen its weakest economic growth in four decades in 2022 after the twin crises of the pandemic and property woes, analysts said ahead of Tuesday's data announcement.
Ten experts interviewed by Agence France-Presse (AFP) forecast an average 2.7% year-over-year rise in the gross domestic product (GDP) for the world's second-largest economy, a sharp plunge from China's 2021 growth of more than 8%.
It could also be China's slowest pace since a 1.6% contraction in 1976 – the year Mao Zedong died – and excluding 2020, after the COVID-19 virus emerged in Wuhan in late 2019.
Beijing had set itself a growth target of around 5.5% for 2022, but this was undermined by the government's "zero-COVID" policy, which put the brakes on manufacturing activity and consumption.
Strict lockdowns, quarantines, and compulsory mass testing prompted abrupt closures of manufacturing facilities and businesses in significant hubs – like Zhengzhou, home of the world's giant iPhone factory – and sent reverberations across the global supply chain.
Beijing abruptly loosened pandemic restrictions in early December after three years of enforcing some of the harshest COVID-19 measures in the world.
China is battling a surge in COVID-19 cases that have overwhelmed its hospitals and medical staff.
This is likely to reflect in 2022's fourth-quarter growth, which will also be announced on Tuesday alongside other indicators such as retail, industrial production, and employment.
"The fourth quarter is relatively difficult," said the Chinese Academy of Social Sciences economist Zhang Ming in Beijing. "No matter whether it's by the metrics of consumption or investment, the growth is slowing."
China's exports took their biggest plunge since the start of the pandemic in December, contracting 9.9% year-over-year, while consumption was in the red in November, and investment has slowed.
"The three horse carriages of the Chinese economy are all facing a relatively evident downward pressure in the fourth quarter," Zhang said.
Rabobank analyst Teeuwe Mevissen echoed Zhang, saying the final quarter will "almost certainly show a decline because of the fast spread of COVID-19" after the loosening of health restrictions in December.
"This will affect demand and supply conditions for the worse," he said. In addition, problems in the property sector are still weighing on growth, Mevissen added.
This sector, which along with construction, accounts for more than a quarter of China's GDP, has suffered since Beijing started cracking down on excessive borrowing and rampant speculation in 2020.
This regulatory tightening marked the beginning of financial worries for Evergrande, the former Chinese number one in real estate now strangled by colossal debt.
Real estate sales have fallen in many cities, and many developers struggle to survive.
However, the government appears to be taking a more conciliatory approach to reviving this critical sector.
Measures to promote "stable and healthy" development were announced in November, including credit support for indebted developers and assistance for deferred-payment loans for homebuyers.
Some analysts took these measures as a reason for optimism.
"The transitional phase will likely be bumpy as the country may need to grapple with surging cases and increasingly stretched health systems," warned analyst Jing Liu of HSBC, predicting a slowdown in the near term.
But, after three years of health restrictions, "China's reopening process has started," she said.
The World Bank forecast China's GDP will rebound to 4.3% for 2023 – still below expectations.
Economist Larry Yang declared 2023 "the year of returning to certainty."
He said he expected growth to accelerate quarter by quarter in 2023, forecasting 5% GDP for the entire year – a prediction in line with other analysts interviewed by AFP.
"The worst period of the economy has already passed," Yang said.
