Still, that figure was higher than expected by economists. A Reuters poll of analysts forecast 3.6% growth compared to a year earlier.
For all of 2021, GDP expanded 8.1% compared to the prior year, roughly in line with analyst expectations. The Chinese government set a goal last spring for its economy to expand at least 6% for the year.
Growth in the last quarter of the year was bolstered by industrial production, which rose 4.3% from a year earlier — accelerating from November’s 3.8% growth.
But consumption dramatically weakened. Retail sales increased just 1.7% in December from a year earlier, sharply lower than November’s 3.9% uptick.
China has been contending with a slew of problems recently, including tumult in its property sector and a series of Covid-19 outbreaks.
Troubled Chinese real estate developer Evergrande — which has some $300 billion of total liabilities — has been struggling to pay its debts and was recently ordered to demolish a few dozen buildings in the country. Analysts have been long concerned that a collapse by Evergrande could trigger wider risks for China’s property market, hurting homeowners and the broader financial system.
Economists have warned that China’s zero-Covid approach to containing the virus could spell serious problems for the economy in 2022. Goldman Sachs, for example, slashed its projection for Chinese economic growth in 2022 to 4.3% from 4.8%, just over half of last year’s figure.
This is a developing story and will be updated.
