(Yicai Global) Jan. 17 -- China’s economy expanded 8.1 percent last year, exceeding a government target of “over 6 percent,” thanks to robust exports during the global pandemic.

Gross domestic product increased to CNY114.37 trillion (USD18.02 trillion) in the 12 months ended Dec. 31, according to data the National Bureau of Statistics published today. The average growth rate over two years was 5.1 percent.

China’s economy carried on steadily recovering from the impact of the pandemic, with the main economic indicators hitting their targets, NBS Director Ning Jizhe said at a press conference to release the data. The country also continued to lead global economic development and the fight against Covid-19, he added.

The figures showed that the world’s second-largest economy was running steadily on a recovery track in 2021, Wang Jun, chief economist of Zhongyuan Bank, told Yicai Global.

Supply and demand gradually improved, while manufacturing and services were sufficiently resilient, Wang said, adding that emerging sectors and high-tech industries kept up strong investment.

New jobs in urban areas increased further, with the surveyed urban employment rate relatively stable, but always lower than the expected target at the beginning of 2021, he added. Income gains were basically in line with economic growth, and the consumer price index remained in a reasonable range and was generally stable.

Export Growth

“The global market has experienced a serious mismatch between supply and demand due to impact of the Covid-19 pandemic,” Wang said. “China’s exports achieved strong growth, not only meeting global demand, but also greatly supporting and spurring the stable recovery of the country’s economy.”

The country’s exports outdid expectations through much of last year, soaring almost 30 percent to USD3.36 trillion, compared with a 3.6 percent gain in 2020, according to data the General Administration of Customs released on Jan. 14. That pushed China’s trade surplus to a new record high of USD676.4 billion.

From the supply side, value-added output at industries above a designated size surged by 9.6 percent in 2021, with the two-year average at 6.1 percent. Growth in value-added output at high-tech and equipment firms hit 18.2 percent and 12.9 percent, respectively.

With respect to demand, total retail sales of consumer goods reached CNY44.08 trillion (USD6.95 trillion), up 12.5 percent, with the two-year average at 3.9 percent. In December, the figure rose 1.7 percent from a year earlier, but fell 0.18 percent from November.

Fixed asset investment totaled CNY54.45 trillion, surging 4.9 percent annually, with the two-year average at 3.9 percent. By sector, infrastructure investment edged up 0.4 percent, while investment in manufacturing and real estate development climbed 13.5 percent and 4.4 percent, respectively.

Sluggish Consumption

Consumption has remained sluggish due to repeated Covid-19 outbreaks, people saving more and a decline in average consumption, according to Luo Zhiheng, chief macro analyst at Yuekai Securities’ research institute.

A new round of measures to support consumer spending are expected, Luo told Yicai Global.

Stabilizing investment will become the current and future focus of government work, with investment in the real estate sector staying stable, while infrastructure investment will gain momentum and funds going into the manufacturing sector will continue to rise.

GDP growth in the first quarter of this year is expected to remain at a relatively low level due to sporadic Covid-19 cases, high raw material costs, cyclical downward pressure on the economy and other factors, said Wu Chaoming, chief economist at Chasing Securities.

That means pressure on the steady growth of GDP will be relatively high in the second, third and fourth quarters, Wu told Yicai Global.

Editors: Xu Wei, Peter Thomas