China's Economic Revision and Future Prospects

Economic Revision and GDP Growth

• China revised its GDP for 2023 upwards by 2.7%, reaching a new total of 129.4 trillion yuan ($17.73 trillion).
• This revision is part of the fifth national economic census and follows previous adjustments of 2.1% for 2018 and 3.4% for 2013.
• The revision reflects China's resilience to various internal and external challenges over the past five years, including the impact of the COVID-19 pandemic.
• The revision is not expected to significantly impact the GDP growth rate for 2024.

Future Economic Plans and Challenges

• China aims for a growth target of "around 5%" for 2025, amidst challenges like potential U.S. tariff hikes.
• Policy measures include increasing the budget deficit and issuing more debt to support economic growth.
• President Xi Jinping's vision of "Chinese-style modernization" aims to double the economy's size by 2035, requiring an average annual growth rate of 4.7%.

Economic Census and Industry Changes

• The economic census indicated a 52.7% rise in business entities in the secondary and tertiary sectors since 2018, while employment growth lagged at 11.9%.
• Tertiary industry employment increased by 25.6% by the end of 2023, whereas secondary industry employment decreased by 4.8%.
• The property sector faces a significant decline, with employment dropping by 27% to 2.71 million by the end of 2023.

Outlook and International Factors

• The World Bank adjusted China's growth forecast for 2024 and 2025 upwards but noted challenges like subdued household and business confidence and issues in the property sector.
• The upcoming U.S. administration may bring further trade tensions, affecting China's economic strategies.

Overview of Workforce Changes in China's Finance and Property Sectors

China's finance and property sectors have seen significant reductions in their workforces over recent years, marking a shift from previous trends of workforce growth in the services sector.

Financial Sector Workforce Reduction

• The financial industry had 12.4 million employees at the end of 2023.
• This figure represents a 32% decrease from five years earlier.
• Factors contributing to this decline include: 
  • A government crackdown on graft.
  • Deep pay cuts.
  • Reduced deal-making activities.

Impact of the Housing Market Collapse

• The number of people working for property developers fell by 27%, down to 2.7 million.
• China's housing market is experiencing its worst downturn in modern history.
• Developers face a liquidity shortage and deteriorating balance sheets.
• Country Garden Holdings Co., once the largest property firm, exemplifies firms hit hardest.

Government Response and Economic Adjustments

• Housing Minister Ni Hong suggested insolvent property firms should go bankrupt or restructure.
• The government shifted focus from supporting financially sound developers to injecting liquidity into residential projects.
• Real estate management and sales agency jobs have helped the overall property workforce rise by 14%.
• Conversely, the number of workers in construction firms decreased by 12% to 51 million.

Revised Economic Indicators

China revised its gross domestic product (GDP) for 2023, increasing it by 2.7%, equating to 3.4 trillion yuan, as reported by Kang Yi, head of the National Bureau of Statistics.

Russia's Response to US Ceasefire Proposal in Ukraine

Russia has rejected the incoming US President Donald Trump's proposal for an immediate ceasefire in Ukraine while expressing willingness to engage in negotiations for a long-term peace agreement to resolve the conflict that has lasted almost three years.

Key Points

• Russian Position:
  • Russian Foreign Minister Sergei Lavrov stated that a ceasefire is seen as ineffective, as it would allow Ukraine to strengthen its military capabilities.
  • Lavrov emphasized the need for conclusive, legally-binding agreements to secure Russian Federation's safety and legitimate security interests of neighboring countries.
• Expectations from the Trump Administration:
  • Lavrov expressed hope that the Trump administration would address the root causes of the conflict.
  • President Putin is open to reviewing any serious, concrete proposals for peace.