China posts sluggish GDP growth in 2023, population declines again | Canada News Media
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China posts sluggish GDP growth in 2023, population declines again

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Official data shows GDP was 5.2 percent in 2023, hitting a government target, but recovery looks uneven.

China’s economy grew by 5.2 percent in 2023, hitting the government’s official target, but concerns about growth momentum remain amid a protracted property crisis, sluggish consumer and business confidence, and weak global growth.

China’s National Bureau of Statistics said gross domestic product (GDP) in the world’s second-biggest economy also rose by 5.2 percent in the final three months of 2023, compared with the same period last year.

Kang Yi, the bureau’s head, said the expansion had been “hard won” and cautioned that the economy faced a complex external environment and insufficient demand moving into 2024.

In 2022, China’s economy grew by just 3 percent as a result of prolonged COVID-19 regulations linked to its zero-COVID policy.

After lifting the measures at the end of 2022, Beijing set itself a growth target of “around five percent” for last year.

After an initial post-pandemic rebound, the economy has been weighed down by the continuing crisis in the property market where the authorities have been trying to rein in massive debts and speculation, as well as record youth unemployment and a global slowdown.

Exports – historically a key growth lever – fell last year for the first time since 2016, according to figures published by the customs agency on Friday.

Chinese Prime Minister Li Qiang was bullish on China’s economy as he spoke to business leaders in Switzerland [Gaetan Bally/Pool via AFP]

Geopolitical tensions with the United States and efforts by some Western nations to reduce dependence on China or diversify their supply chains have also hit growth.

Chinese officials are due to release their growth target for 2024 in March.

‘Not a risk’

China is seeking to lure back international investors who have become increasingly sceptical about the Chinese growth story.

Speaking at the World Economic Forum in the Swiss resort of Davos, Chinese premier Li Qiang said his country had achieved its economic target without resorting to “massive stimulus” and painted a bullish picture of the situation.

He said China had “good and solid fundamentals in its long-term development” and that Beijing would “adhere to its basic national policy of opening up to the outside world”.

Li cast a decision to invest in China as “not a risk but an opportunity”.

But risks abound in the era of Chinese leader Xi Jinping.

There was widespread alarm last year after a series of raids on consultancy and due-diligence firms following Beijing’s expansion of its espionage law, while the problems dogging the property market remain unresolved.

The industry has long accounted for about a quarter of China’s economy and experienced dazzling growth for two decades.

But financial woes at major developers such as Evergrande and Country Garden have left projects unfinished, buyers out of pocket and prices on the decline.

Also weighing on the economy is a lack of jobs for the country’s young people.

A record of more than one in five people aged 16 to 24 in China were unemployed in May, according to officials.

Beijing has since stopped publishing monthly youth unemployment figures.

Record low births and a surge in deaths led to a decline in China’s population for the second year in a row [Tingshu Wang/Reuters]

China also faces longer-term questions over its growth potential after it announced its population fell for a second consecutive year in 2023, amid a record low birth rate and a wave of COVID-19 deaths after zero-COVID policies were abruptly lifted.

The National Bureau of Statistics said the total number of people in China dropped by 2.08 million, or 0.15 percent, to 1.409 billion in 2023.

(Al Jazeera)

That was well above the population decline of 850,000 in 2022, which had been the first since 1961, during the Great Famine of the Mao Zedong era.

Total deaths last year rose by 6.6 percent to 11.1 million, with the death rate reaching the highest level since 1974, during the Cultural Revolution.

New births fell 5.7 percent to 9.02 million and the birth rate was a record low 6.39 births per 1,000 people, down from a rate of 6.77 births in 2022.

 

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Minimum wage to hire higher-paid temporary foreign workers set to increase

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OTTAWA – The federal government is expected to boost the minimum hourly wage that must be paid to temporary foreign workers in the high-wage stream as a way to encourage employers to hire more Canadian staff.

Under the current program’s high-wage labour market impact assessment (LMIA) stream, an employer must pay at least the median income in their province to qualify for a permit. A government official, who The Canadian Press is not naming because they are not authorized to speak publicly about the change, said Employment Minister Randy Boissonnault will announce Tuesday that the threshold will increase to 20 per cent above the provincial median hourly wage.

The change is scheduled to come into force on Nov. 8.

As with previous changes to the Temporary Foreign Worker program, the government’s goal is to encourage employers to hire more Canadian workers. The Liberal government has faced criticism for increasing the number of temporary residents allowed into Canada, which many have linked to housing shortages and a higher cost of living.

The program has also come under fire for allegations of mistreatment of workers.

A LMIA is required for an employer to hire a temporary foreign worker, and is used to demonstrate there aren’t enough Canadian workers to fill the positions they are filling.

In Ontario, the median hourly wage is $28.39 for the high-wage bracket, so once the change takes effect an employer will need to pay at least $34.07 per hour.

The government official estimates this change will affect up to 34,000 workers under the LMIA high-wage stream. Existing work permits will not be affected, but the official said the planned change will affect their renewals.

According to public data from Immigration, Refugees and Citizenship Canada, 183,820 temporary foreign worker permits became effective in 2023. That was up from 98,025 in 2019 — an 88 per cent increase.

The upcoming change is the latest in a series of moves to tighten eligibility rules in order to limit temporary residents, including international students and foreign workers. Those changes include imposing caps on the percentage of low-wage foreign workers in some sectors and ending permits in metropolitan areas with high unemployment rates.

Temporary foreign workers in the agriculture sector are not affected by past rule changes.

This report by The Canadian Press was first published Oct. 21, 2024.

— With files from Nojoud Al Mallees

The Canadian Press. All rights reserved.

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PBO projects deficit exceeded Liberals’ $40B pledge, economy to rebound in 2025

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OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.

However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.

The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.

Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.

The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.

The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.

This report by The Canadian Press was first published Oct. 17, 2024.

The Canadian Press. All rights reserved.

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Statistics Canada says levels of food insecurity rose in 2022

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OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.

In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.

The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.

Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.

In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.

It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.

This report by The Canadian Press was first published Oct 16, 2024.

The Canadian Press. All rights reserved.

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