China’s economy grew 6.9 % last year

​GDP growth last year slowed slightly from previous year’s 7.3 % as expected. In the final quarter of 2015, GDP grew 6.8 % y-o-y. Seasonally adjusted quarterly growth slowed from 1.8 % in 3Q15 to 1.6 % in 4Q15. Nominal GDP growth was 6 % y-o-y in the fourth quarter and 6.4 % for all of 2015.

2015 saw progress in the economy’s structural change. For the first time ever, the service sector accounted for over half of the economy, while manufacturing and construction accounted for about 40 % and primary production 9 %. Manufacturing and construction were up 6 % y-o-y in real terms, while real growth in the service sector exceeded 8 %. Finance (up 16 %) was the fastest growing branch within the service sector, in itself responsible for about 20 % of last year’s GDP growth. Nearly 90 % of nominal GDP growth came from services, as industrial prices kept falling.

December’s headline economic figures held few surprises. Industrial output growth slowed to 5.9 % y-o-y (6.1 % overall in 2015 and 8.3 % in 2014). Growth in retail sales remained at 11 %. Online sales were up 33 % last year, with 12 % of all goods transactions occurring online. Average per capita disposable income increased last year to 22,000 yuan (€3,100), an increase of 7 % from 2014 in real terms.

Fixed investment growth slowed from 16 % in 2014 to 10 % last year. The pace of slowdown in manufacturing growth and structural change has picked up speed. For example, the volume of steel production in 2015 was down 2 % y-o-y, while the volume of steel exports rose 20 %. The fall in domestic steel demand reflects a slowdown in construction. New building construction, measured in terms of floorspace, fell 14 % y-o-y. Production of electricity and cement were also down slightly from their 2014 levels.

Growth in GDP, industrial output and retail sales, %

Source: Macrobond