Beijing: Technological innovation and robust policy support for domestic demand are bolstering China's economic resilience, providing a stable foundation for growth through the remainder of the year, economists said.
According to Emirates News Agency, the assessment follows Moody's Ratings' decision to affirm China's A1 sovereign credit rating and revise its outlook to stable, a move welcomed by the Ministry of Finance. The ministry stated that the move reflects Moody's recognition of the strong resilience of China's macroeconomy and fiscal strength amid external shocks, as well as new drivers and progress in the country's high-quality development.
The Chinese government has rolled out a package of macroeconomic measures and strengthened policy coordination. As a result, the economy has withstood pressures and moved toward more advanced development, demonstrating the advantages of its vast domestic market, well-developed supply chains, and strong export competitiveness-key pillars supporting China's sovereign credit profile.
Looking ahead, the ministry mentioned that China will further deepen reforms, enhance fiscal sustainability, and accelerate the development of new quality productive forces to solidify its economic foundation and better weather external uncertainties while contributing more to global economic recovery and prosperity.
Moody's cited China's large and diversified economy and growing innovation capacity, particularly in higher value-added sectors, as key factors underpinning the rating. Jeremy Zook, Lead Analyst for China at Fitch Ratings, noted the country's strength lies in its dominant role in global manufacturing and supply chains, alongside rapid advances in renewable energy and electric vehicles.
Over the past five years, China's GDP has expanded by more than 35 trillion yuan ($5.1 trillion). During the 2021-2025 period, the economy grew at an average annual rate of 5.4 percent, contributing around 30 percent of global growth, according to the Ministry of Finance.
Xiong Yi, Chief Economist for China at Deutsche Bank, said that China's GDP growth of 5 percent in the first quarter exceeded market expectations, with the expansion driven mainly by domestic investment and exports. The property sector has also begun to show encouraging signs of stabilization.
China's manufacturing sector is also emerging from deflation, supported by efforts to curb excessive competition, a global investment cycle, and energy-related factors. Economists at Deutsche Bank expect further improvements in corporate revenues and profitability, which are likely to help reinforce the recovery of investment and employment in the future.
Analysts at Orient Golden Credit Rating International highlighted that China's GDP growth in the first quarter was driven by a rebound in investment after a previous slowdown and a slight acceleration in consumption. They added that high-tech manufacturing and other new productive forces are expected to sustain stable economic performance and drive future growth.