Xi Jinping admitted people are struggling to find jobs and “meet basic needs” in China, as new data pointed to a continued slowdown in factories and the housing market.
In a rare acknowledgment of economic weakness in his New Year message, the Chinese president acknowledged that businesses faced a “difficult” year in 2023, adding that “some people had difficulty finding jobs and meeting basic needs.”
His comments came amid further signs of an economic slowdown on Sunday, as new data showed that factory activity in China shrank to its weakest level in six months.
The official purchasing managers’ index for manufacturing fell to 49 in December, down from 49.4 in November, reaching its lowest level since June, according to the National Bureau of Statistics.
Any score below 50 indicates a contraction in economic activity. Kelvin Lam, of macroeconomics firm Pantheon, said Chinese manufacturing “continues to falter” despite Beijing’s efforts to support the economy.
He added, “The impact of the recent fiscal stimulus has not yet appeared on the economy,” noting that reconstruction efforts in areas affected by natural disasters have slowed due to the harsh winter weather.
Meanwhile, the decline in new home sales also accelerated in December. The value of new homes sold by the country’s 100 largest real estate companies fell by almost 35% from the previous year to 451.3 billion yuan (£50 billion).