Text: Yan Xiang, Xu Ruchun
On April 16, the National Bureau of Statistics released economic data for the first quarter and March of 2024. According to preliminary calculations, the GDP in the first quarter was 296299 billion yuan, and the GDP in the first quarter of 2024 increased by 5.3% year-on-year at constant prices. On a quarter-on-quarter basis, GDP in the first quarter of 2024 grew by 1.6% compared to the fourth quarter of the previous year. In terms of structure, in the first quarter of 2024, the acceleration of industrial production activities will drive the growth of added value of the secondary industry to accelerate significantly, and the tertiary industry will maintain a high growth rate to support the economic recovery. The added value of the primary industry was 1,153.8 billion yuan, up by 3.3 percent year-on-year, the added value of the secondary industry was 109846 billion yuan, up by 6.0 percent, 1.3 percentage points faster than that in 2023, and the added value of the tertiary industry was 174915 billion yuan, up by 5.0 percent. On the production side, in the first quarter, the added value of industrial enterprises above designated size increased by 6.1% year-on-year, a significant increase of 1.5 percentage points over 2023. In terms of structure, among the three major categories, the year-on-year growth rate of industrial added value in the manufacturing industry has increased significantly compared with last year. In terms of industries, the growth of added value of high-tech manufacturing industry has accelerated significantly. On the demand side, on the consumption side, in the first quarter, the total retail sales of consumer goods reached 120327 billion yuan, and the retail sales of consumer goods other than automobiles 109163 billion yuan, both up 4.7% year-on-year. In terms of consumption type, retail sales of goods increased by 4.0 percent, food and beverage revenue increased by 10.8 percent, and retail sales of services increased by 10.0 percent year-on-year in the first quarter. In terms of investment, in the first quarter, the national investment in fixed assets increased by 4.5% year-on-year, of which private investment increased by 0.5% year-on-year. In terms of sub-sectors, the continuous acceleration of manufacturing investment has led to a significant improvement in investment growth, the growth rate of infrastructure investment has maintained a steady and positive trend, and the supply and demand ends of the real estate market are still in a period of transformation and adjustment. Judging from the economic data in the first quarter, the mainland's economy in 2024 will continue to pick up and improve since last year, and the main indicators at both ends of supply and demand will grow steadily and rise steadily, achieving a good start. In terms of trends, some economic indicators in March fell compared with the previous two months, and a large part of this was due to the impact of the base effect. From the perspective of industrial growth, the rebound in GDP growth in the first quarter was mainly driven by the acceleration of industrial production and the continuous improvement of the service industry, which contributed more than 90% to GDP growth. Among them, the unexpected rebound of the industrial economy was affected by many factors such as improved domestic and foreign demand and boosted business confidence. From the perspective of economic structure, the high-quality development of the mainland's economy has continued to advance, and the development of new quality productive forces has achieved positive results. Generally speaking, the mainland economy is currently in a stage of moderate recovery, and looking ahead, with the continuous recovery of the economy's internal vitality, we expect that the trend of rebounding will continue in the future; from a structural point of view, "relying on quality to promote quantity and stability" will be an important feature of China's economic development in the future, and the economic structure will continue to improve in the future. Risk Warning: First, geopolitical risks exceed expectations, second, macroeconomic risks are less than expected, and third, overseas markets fluctuate sharply.
The main body of the report
1. The economy got off to a steady start
On April 16, the National Bureau of Statistics released economic data for the first quarter and March of 2024. According to preliminary calculations, the GDP in the first quarter was 296299 billion yuan, a year-on-year increase of 4.2%. At constant prices, GDP grew by 5.3% year-on-year in the first quarter of 2024, 0.1 percentage points faster than in both 2023 and the fourth quarter of 2023. On a quarter-on-quarter basis, GDP in the first quarter of 2024 increased by 1.6% quarter-on-quarter from the fourth quarter of the previous year.
In terms of structure, in the first quarter of 2024, the acceleration of industrial production activities will drive the growth of added value of the secondary industry to accelerate significantly, and the service industry of the tertiary industry will maintain a relatively high growth rate to support the economic recovery. By industry, the added value of the primary industry was 1,153.8 billion yuan, up by 3.3 percent year-on-year, slowing down by 0.8 percentage points and 0.9 percentage points from the whole year of 2023 and the fourth quarter of 2023, respectively, the added value of the secondary industry was 109846 billion yuan, up by 6.0 percent, accelerating by 1.3 and 0.5 percentage points from the whole year of 2023 and the fourth quarter of 2023, respectively, and the added value of the tertiary industry was 174915 billion yuan, up by 5.0 percent , which were 0.8 and 0.3 percentage points slower than the full year of 2023 and the fourth quarter of 2023, respectively. In the first quarter of 2024, the contribution of the primary industry to nominal GDP growth will drop from 0.1 percentage points in 2023 to 0, the contribution of the secondary industry to nominal GDP will increase significantly from 0.7 percentage points in 2023 to 1.3 percentage points, and the contribution of the tertiary industry service industry to nominal GDP will drop from 3.8 percentage points in 2023 to 2.9 percentage points. In a single quarter, the growth of the secondary industry, represented by industry, continued to improve in the first quarter of 2024, and the tertiary industry service industry remained the main driving force for economic growth. In the first quarter of 2024, the contribution of the primary industry to nominal GDP growth was 0, unchanged from the performance of the fourth quarter of 2023, the contribution of the secondary industry to nominal GDP in the current quarter increased slightly to 1.3% from 1.1% in the fourth quarter of 2023, and the contribution of the tertiary industry to nominal GDP was 2.9%, basically unchanged from 3.0% in the fourth quarter of 2023.
2 Production side: industrial production growth activities accelerated In the first quarter of 2024, the added value of industrial enterprises above designated size increased by 6.1% year-on-year (the growth rate of added value is the real growth rate after deducting price factors), which is 1.5 percentage points faster than that in 2023. In March, the added value of industrial enterprises above designated size increased by 4.5 percent year-on-year, maintaining a relatively rapid growth rate; from a month-on-month perspective, in March, the added value of industrial enterprises above designated size fell slightly by 0.08 percent over the previous month.
From a structural point of view, the year-on-year growth rate of the added value of the three major categories in the first quarter of 2024 will be differentiated, among which the year-on-year growth rate of the industrial added value of the manufacturing industry will increase significantly compared with last year. Specifically, in the first quarter of 2024, the added value of the mining industry increased by 1.6% year-on-year, a slight slowdown of 0.7 percentage points from 2023, the manufacturing industry increased by 6.7%, a significant acceleration of 1.7 percentage points from 2023, and the production and supply of electricity, heat, gas and water increased by 6.9%, an acceleration of 2.6 percentage points from 2023. In March, the added value of the mining industry increased by 0.2% year-on-year, the manufacturing industry increased by 5.1%, and the production and supply of electricity, heat, gas and water increased by 4.9%.
In terms of industries, in the first quarter of 2024, the growth of added value of high-tech manufacturing industry will accelerate significantly. In the first quarter of 2024, the added value of high-tech manufacturing increased by 7.5%, 2.6 percentage points faster than the fourth quarter of last year. Among them, in the first quarter of 2024, the added value of the computer, communication and other electronic equipment manufacturing industry increased by 13.0% year-on-year, a significant acceleration of 9.6 percentage points over 2023.
3 Demand side: Consumption grew steadily, investment continued to accelerate3.1 Service demand continued to release
In terms of consumption, in the first quarter of 2024, the total retail sales of consumer goods 120327 billion yuan, a year-on-year increase of 4.7%. Among them, the retail sales of consumer goods other than automobiles 109163 billion yuan, an increase of 4.7%. In terms of monthly growth rate, in March 2023, the total retail sales of consumer goods reached 3,902 billion yuan, a year-on-year increase of 3.1%, and the growth rate in the first two months was 5.5%, of which the retail sales of consumer goods other than automobiles were 3,496.8 billion yuan, an increase of 3.9%.
According to the type of consumption, the retail sales of goods accounted for nearly 90% of the total social consumption, and the growth of retail sales of goods supported the continuous growth of the total retail sales of consumer goods. In the first quarter of 2024, retail sales of goods 106882 billion yuan, an increase of 4.0%, driving the total retail sales of consumer goods to rebound by 3.6 percentage points, and catering revenue of 1,344.5 billion yuan, an increase of 10.8%, driving the total retail sales of consumer goods to increase by 1.1 percentage points. In the first quarter of 2024, retail sales of services increased by 10.0% year-on-year, continuing to maintain a high growth rate. In March, the retail sales of goods reached 3,505.6 billion yuan, a year-on-year increase of 2.7 percent, driving the total retail sales of social consumption to increase by 2.4 percentage points, and the revenue of catering increased by 6.9 percent year-on-year, driving the total retail sales of social consumption to increase by 0.7 percentage points. Among the commodities above designated size, the sales of basic living commodities were good, and the retail sales of grain, oil, food and beverages of units above designated size increased by 9.6 percent and 6.5 percent respectively. The sales of some upgraded commodities grew rapidly, and the retail sales of sports and entertainment goods and communication equipment of units above designated size increased by 14.2 percent and 13.2 percent respectively.
On the residential side, residents' income grew steadily in the first quarter of 2024. In the first quarter of 2024, the per capita disposable income of residents nationwide was 11,539 yuan, a nominal increase of 6.2% year-on-year, a slight decrease of 0.1 percentage points from 2023, and a real growth rate of 6.2% after deducting price factors, a growth rate of 0.1 percentage points faster than that in 2023. In the same period, the per capita consumption expenditure of residents nationwide was 7,299 yuan, a nominal increase of 8.3% over the same period of the previous year and 9.2% in 2023, and a real increase of 8.3% after deducting the impact of price factors, a decrease of 0.7 percentage points from 2023.
3.2 Significant acceleration in manufacturing investment In the first quarter of 2024, the national investment in fixed assets (excluding rural households) reached 100042 billion yuan, a year-on-year increase of 4.5% (calculated on a comparable basis), 0.3 percentage points faster than the previous two months, and 1.5 percentage points faster than that in 2023. Among them, private investment increased by 0.5% year-on-year, and the year-on-year increase in private investment continued to expand.
In terms of sectors, the continuous acceleration of manufacturing investment in the first quarter of 2024 led to a significant improvement in investment growth, and the growth rate of infrastructure investment maintained a steady and positive trend. Manufacturing investment grew by 9.9% in the first quarter of 2024, 3.4 and 0.5 percentage points faster than in the whole of 2023 and the first two months of 2024, respectively, and infrastructure investment (excluding electricity, heat, gas and water production and supply) increased by 6.5% year-on-year, 0.6 and 0.2 percentage points faster than in the full year of 2023 and the first two months of 2024, respectively. Through the cumulative growth rate backwards, the year-on-year growth rates of manufacturing investment and infrastructure investment (excluding electricity, heat, gas and water) in March were 10.3% and 6.6% respectively, 0.9 and 0.3 percentage points faster than that from January to February, respectively.
From the perspective of both supply and demand, the real estate market is still in a period of transformation and adjustment. In the first quarter of 2024, the national real estate development investment was 2,208.2 billion yuan, a year-on-year decrease of 9.5% (calculated on a comparable basis), a year-on-year decline of 9.6% in 2023, and a decline of 9.0% in the first two months of 2024, which is still in the stage of continuous grinding. From the perspective of monthly trends, in March, the year-on-year growth rate of real estate development investment was -16.8%, an increase of 7.8 percentage points from the previous two months. From the perspective of the start and completion of real estate enterprises, in March, the area of housing completions decreased by 25.6% year-on-year, and the area of new construction fell by 22.1% year-on-year, both of which continued to grow negatively.
On the demand side, the growth rate of real estate sales is still at a low level, and the price index trend is weak. In the first quarter of 2024, the sales area of newly built commercial housing was 226.68 million square meters, a year-on-year decrease of 19.4%, compared with the decline in the whole year of 2023, and the monthly growth rate was -23.7% year-on-year in March. From the price side, in March, among the 70 large and medium-sized cities, the month-on-month decline in the sales price of commercial housing in all tiers of cities narrowed slightly and expanded, and the price index of newly built commercial housing in 70 large and medium-sized cities decreased by 0.34% month-on-month and 2.65% year-on-year respectively. Among them, Shanghai rose by 0.5% month-on-month, Beijing was flat, and Guangzhou and Shenzhen fell by 0.7% and 0.4% month-on-month, respectively. On a year-on-year basis, Beijing and Shanghai rose by 0.8% and 4.3% respectively, while Guangzhou and Shenzhen both fell by 5.5%.
4 Summary and outlookFrom the economic data of the first quarter, the mainland economy in 2024 will continue to rebound and improve since last year, and the main indicators at both ends of supply and demand will grow steadily, and achieve a good start.
In terms of trends, some economic indicators in March fell compared with the previous two months, and a large part of this was due to the impact of the base effect. 2023 is the first year for the full liberalization of epidemic prevention and control in the mainland, and at the beginning of the year, some areas were still plagued by the epidemic, so some workloads were delayed to March and April. Affected by the high base under the year-on-year statistical caliber, some economic indicators fell in March. Taking the added value of industrial enterprises above designated size as an example, the average daily industrial added value in March was 6.3% higher than that in January and February from a month-on-month perspective. From the perspective of industrial growth, the rebound in GDP growth in the first quarter was mainly driven by the acceleration of industrial production and the continuous improvement of the service industry, which contributed more than 90% to GDP growth. In terms of industrial production, the industrial added value increased by 6.1% in the first quarter, a significant acceleration of 1.5 percentage points compared with 2023, and contributed 37.3% to GDP growth. The service industry still maintained a rapid growth rate in the case of a high base last year, the holiday consumption demand continued to release, and the number of domestic tourism trips and expenses during the Spring Festival holiday have exceeded the level of the same period in 2019, according to the calculation of the Bureau of Statistics, the contribution rate of the service industry to economic growth is 55.7%. The larger-than-expected rebound in the industrial economy was affected by various factors, including improved domestic and foreign demand and boosted business confidence. First, the improvement of domestic demand and external demand supports industrial growth. In terms of external demand, since the beginning of this year, the manufacturing PMI of major countries in the world has shown signs of recovery, and the growth rate of mainland exports has also achieved a positive growth of 4.9% in the first quarter; Second, policy support boosts business confidence. On March 13, the State Council issued the "Action Plan for Promoting Large-scale Equipment Renewal and Consumer Goods Trade-in", requiring that by 2027, the scale of equipment investment in industry, agriculture, construction, transportation, education, cultural tourism, medical and other fields will increase by more than 25% compared with 2023; Subsequently, on March 27, the Ministry of Industry and Information Technology and other seven departments issued the implementation plan for promoting the renewal of equipment in the industrial field, and on April 7, the central bank announced the establishment of a 500 billion yuan quota of scientific and technological innovation and technological transformation re-loans. The continuous implementation of relevant policy measures has strengthened business confidence, and China's manufacturing PMI index was 50.8% in March, returning to the expansion range. From the perspective of economic structure, the high-quality development of the mainland's economy has continued to advance, and the development of new quality productive forces has achieved positive results. In terms of production, in the first quarter, the added value of the high-tech manufacturing industry above designated size increased by 7.5 percent year-on-year, an increase of 2.6 percentage points over the fourth quarter of last year, 1.4 percentage points higher than the average level of all industries above designated size, and a 1.1 percentage point increase in the added value of industrial enterprises above designated size; the high-tech service industry continued to maintain a relatively rapid growth trend, and the added value of information transmission, software, and information technology services increased by 13.7 percent, an increase of 2.5 percentage points over the fourth quarter of last year. In terms of investment, in the first quarter, investment in high-tech industries increased by 11.4 percent year-on-year, an increase of 1.1 percentage points over last year, and investment in high-tech services increased by 12.7 percent. Generally speaking, the mainland economy is currently in a stage of moderate recovery, and looking ahead, with the continuous recovery of the economy's internal vitality, we expect that the trend of rebounding will continue in the future; from a structural point of view, "relying on quality to promote quantity and stability" will be an important feature of China's economic development in the future, and the economic structure will continue to improve in the future. 5 Risk Warning
First, geopolitical risks exceed expectations, second, macroeconomic risks are lower than expected, and third, overseas markets fluctuate sharply.
This article is from the report "Q1 Economic Data Review: Continued Improvement Trend is Clear" released by Huafu Securities Research Institute on April 16, 2024.
Analyst:
燕翔, S0210523050003
许茹纯, s0210523060005
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