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Published: 10:44, July 15, 2021 | Updated: 10:16, July 16, 2021
China's GDP expands 12.7% in H1
By Xinhua
Published:10:44, July 15, 2021 Updated:10:16, July 16, 2021 By Xinhua

BEIJING - China's gross domestic product (GDP) expanded 12.7 percent year-on-year in the first half of 2021 as recovery continues to firm, data from the National Bureau of Statistics (NBS) showed Thursday.

The figure puts average H1 growth for the past two years at 5.3 percent, 0.3 percentage points faster than the two-year average of Q1 growth from the 2019 level, according to the NBS.

In the second quarter, the country's GDP grew 7.9 percent year-on-year, the data showed. On a quarterly basis, the economy expanded 1.3 percent in Q2.

Other major economic indicators showed continued improvements across the board, with industrial output rising 15.9 percent and retail sales up 23 percent year-on-year in the first half.

The country's surveyed urban unemployment rate stood at 5 percent in June, 0.7 percentage points lower than the same period last year. A total of 6.98 million new urban jobs, or 63.5 percent of the annual target, were created in the first half.

In the six-month period, China's per capita disposable income increased 12.6 percent year-on-year in nominal terms to 17,642 yuan (about US$2,731), basically keeping pace with the GDP increase.

In the first quarter of 2021, the Chinese economy grew 18.3 percent year-on-year as strong domestic and foreign demands powered recovery from a low base in early 2020 when COVID-19 stalled the world's second-largest economy.

"The national economy has, in general, sustained a steady recovery in the first half," said Liu Aihua, a spokesperson with the NBS.

Liu, however, cautioned of uncertainties stemming from the global spread of the pandemic and the unbalanced recovery domestically.

But considering the supply-demand cycle, market confidence and the increasingly strong domestic demand, China's economy is expected to maintain the recovery trend in the second half of 2021, Liu added.

China has aimed for an economic expansion of over 6 percent in 2021. It also aims to create more than 11 million new urban jobs and expand domestic demand and effective investment, which are expected to put the economy firmly back to pre-pandemic vibrancy.

The World Bank, in a report last month, forecast that China's economic growth will be at 8.5 percent in 2021.

China's recovery has broadened as its economic activities have continued to normalize under the country's effective containment of COVID-19, according to the report.

ALSO READ: China's GDP surges 18.3% year-on-year in Q1

Industrial output rises 15.9%


China's value-added industrial output, an important economic indicator, went up 15.9 percent year-on-year in the first half of this year, data from the NBS showed.

The figure puts average H1 growth for the past two years at 7 percent, 0.2 percentage points faster than the two-year average of Q1 growth from the 2019 level, according to the NBS.

In the second quarter, industrial output went up 8.9 percent year-on-year, while in June alone, it rose 8.3 percent year-on-year, the NBS said.

The industrial output is used to measure the activity of designated large enterprises with an annual business turnover of at least 20 million yuan (about US$3.09 million).

In a breakdown by ownership, the output of the private sector went up 18.3 percent year-on-year in June while that of state-controlled enterprises rose 11.9 percent.

Among the three major sectors namely, manufacturing, mining, and production and supply of utilities, the manufacturing sector's output showed the fastest growth, climbing 17.1 percent year-on-year in June.

Meanwhile, the output of high-tech manufacturing expanded by 22.6 percent last month from a year ago.

Fixed-asset investment up 12.6%

China's fixed-asset investment went up 12.6 percent year-on-year in the first half of 2021, compared with the 15.4-percent increase in the first five months, the NBS said.

Total fixed-asset investment came in at 25.59 trillion yuan (about US$3.96 trillion) in the first half, according to the NBS.

In breakdown, the investment in the primary industry rose 21.3 percent from the same period last year, while that in the secondary and tertiary industries increased 16.3 percent and 10.7 percent, respectively.

The investment in high-tech industries increased 23.5 percent in the first half, the NBS said.

Private investment expanded 15.4 percent during the period, compared with the 18.1-percent increase in the first five months.

Fixed-asset investment includes capital spent on infrastructure, property, machinery and other physical assets.

Retail sales surge 23%

China's retail sales of consumer goods jumped 23 percent year-on-year in H1 of this year, data from the NBS showed.

The two-year average growth stood at 4.4 percent, 0.2 percentage points faster than that in the first quarter.

In the second quarter, retail sales went up 13.9 percent year-on-year, bringing the average growth for the past two years to 4.6 percent.

Retail sales in June were 12.1 percent higher from a year earlier, or 10 percent higher than June 2019.

The growth reversed from declines seen in H1 2020, when consumer spending was disrupted by the COVID-19 epidemic. 

Disposable income rises 12.6% 

China's per capita disposable income stood at 17,642 yuan (about US$2,731) in the first half of the year, up 12.6 percent from the same period last year in nominal terms, official data showed.

After deducting price factors, per capita disposable income rose 12 percent year-on-year.

The higher growth rate was mainly affected by the low base in the first half of last year, according to the National Bureau of Statistics.  

Separately, urban per capita disposable income came in at 24,125 yuan, up 11.4 percent in nominal terms, and 10.7 percent in real terms, while income in rural areas stood at 9,248 yuan, up 14.6 percent in nominal terms, and 14.1 percent in real terms.

Chinese per capita nominal consumer spending rose 18 percent year-on-year to 11,471 yuan in the first half of the year. After factoring in price levels, spending went up 17.4 percent year-on-year.

Property investment up 15%

China's investment in property development rose 15 percent year-on-year in the first half of 2021, the NBS said.

Total property investment in the period stood at about 7.22 trillion yuan (about US$1.12 trillion), the NBS said.

Compared with the 2019 level, property investment went up 17.2 percent, putting average January-June growth for 2020 and 2021 at 8.2 percent.

Investment in residential buildings came in at 5.42 trillion yuan, up 17 percent from the same period last year.

Commercial housing sales rose 27.7 percent year-on-year in terms of floor area to 886.35 million square meters. In terms of value, commercial housing sales climbed 38.9 percent year-on-year .

The property development climate index compiled by the NBS stood at 101.05 points in June.

READ MORE: China's quarterly GDP growth may reach record high

Housing market generally stable


China's housing market remained stable in June as home prices in 70 major cities reported slight increases amid government efforts to curb speculation and forestall financial risks.

New home prices in four first-tier cities -- Beijing, Shanghai, Shenzhen and Guangzhou -- rose 0.7 percent month on month in June, according to data from the NBS.

The growth rate was flat with the expansion seen in May. Prices of second-hand homes in the four cities gained 0.7 percent last month, up 0.1 percentage points from the growth in May.

A total of 31 second-tier cities saw a month-on-month increase of 0.5 percent in new home prices, while 35 third-tier cities witnessed a month-on-month rise of 0.3 percent in new home prices last month.

On a year-on-year basis, new home prices in first-tier cities rose 6.1 percent in June, up from 6-percent growth in May, while those in second-tier and third-tier cities went up 4.8 percent and 3.7 percent, respectively.

Under the principle that housing is for living in, not for speculation, real estate control measures across China are gradually evolving to tackle housing problems in big cities.

Since last year, first-tier cities in China that had been under pressure to curb speculative demand have rolled out a slew of measures to regulate and control the property market multiple times.  

In February this year, Shenzhen announced transaction reference prices for resale homes in the city, which are generally lower than the market prices. Many banks extend mortgage loans in line with the reference prices in a bid to cool down the market.  

The city has also taken measures to prevent the illegal flow of consumer loans and business loans into the real estate market to clamp down on excessive market speculation.

The moves had a direct impact on the market, with transactions of second-hand homes in Shenzhen falling below 5,000 for three consecutive months in the first half of 2021. In June alone, the city reported some 2,575 home transfers, down 15 percent month on month and 76 percent year-on-year.

In Beijing, regulators vowed to intensify the crackdown on misappropriating loans for housing purchases, and Guangzhou had introduced several policies including mortgage rate increases for residents' first and second houses to curb speculative demand.

Due to the restrictions, China's property loans increased at a slower pace in June, official data showed.  

As of the end of June, loans to the property sector expanded by 10.3 percent year-on-year, lower than that of total loans, according to data from the China Banking and Insurance Regulatory Commission.

As the Shenzhen practice of adopting transaction reference prices for resale homes had proved effective in curbing price rises, the policy may be replicated in more large and medium-sized cities across the country, according to the latest research note by Citic Securities.

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