The Chinese economy expanded more than expected in the first three months of the year, as official data today showed a sustained The conditions of the crisis in the Middle East, which threatens to affect global growth, writes Reuters. The figures come amid a spike in global energy prices caused by the US-Israeli war with Iran, which has disrupted shipping through the key Strait of Hormuz, through which a fifth of the world's oil and natural gas passes.
Analysts say China's diversified energy supplies protect it from direct The conflict, although a potential global recession caused by the war, could weaken the export demand that supports the country's economy. The gross domestic product of the world's second-largest economy grew by 5% year-on-year in the three months from January to March, according to the National Bureau of Statistics (NBS).
Πoĸkazĸlyat is slightly higher than the AFR's forecast of 4.8%, based on consensus among economists. ΠThrough the first quarter, China's economy "achieved a strong start to the year, further demonstrating its resilience and vitality", the Xinhua News Agency said in a statement announcing the data.
The information comes two days after the International Monetary Fund cut its global growth forecast for 2026, warn that the global economy could be "derailed from the brink" of war in the Middle East. The Fund also cut its forecast for China to 4.4% growth, from a previous estimate of 4.5%.
"The global economy is adjusting ahead of the next stress test, as signs of inequality lie beneath the surface", the statement said, noting that "China's domestic activity, particularly in the housing sector, "left out of the picture".
&P;ekin has set a target for 2026 of 4.5-5% growth - the lowest in decades. A long-running real estate crisis and a steady decline in domestic spending have left leaders dependent on imports to meet growth targets.
Trade Barriers
Outbound shipments have been booming, as exemplified by the country's huge trade surplus of $1.2 trillion last year.
This week's latest data It said that export growth slowed sharply in March, suggesting that the war in the Middle East is already having an impact on the economy. Today's data from the NBS also showed that retail sales rose 1.7% year-on-year in March, well below Bloomberg's forecast of 2.4%.
ΠIndustrial output rose 5.7%, according to the NBS, beating Bloomberg's forecast of 5.3% but well below the 6.3% seen in January and February combined. The slowdown in growth in the first quarter was supported by external factors, writes Ziqin Jiang of Sarital Economics.
"We expect growth to slow slightly in the rest of the year. While the Chinese economy is holding up well, it is becoming increasingly dependent on external demand. The war with Iran "will likely contribute to this trend."
A major international trade fair opens this week in Ganja, a metropolis in China's southern manufacturing hub, where participants told AFR that the war is affecting their business. Chinese exporters and buyers from the Middle East told AFR on the opening day of the Canton Fair yesterday that the war in Iran had led to a drop in orders and had pushed up prices.
Wang Jun, deputy head of China's customs administration, this week acknowledged "a lot of uncertainty and instability in the external Wednesday.
"The impact of international geopolitical conflicts on global industrial and supply chains is still evolving in a complex way," he commented.