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China’s Golden Week holiday provided some relief for the world’s second-largest economy as it struggles to recover from the coronavirus pandemic but policymakers will have to take action to spur stronger growth, economists say.
Domestic tourism numbers and revenue during the eight-day holiday, which combined the mid-Autumn festival and National Day, were slightly higher than 2019 levels before the pandemic, official figures showed.
But activity in the stricken property market, which analysts say lies at the heart of China’s economic woes, remained lacklustre, with fewer people than expected inspired by the holiday cheer to buy a new home.
With China’s third-quarter gross domestic product data expected next week, analysts will be looking for signs that Beijing will continue to support the recovery with sustained stimulus measures.
“The economy is resilient,” said Heron Lim, greater China economist at Moody’s Analytics. “But in terms of strong growth, that is still missing.”
China’s economy was expected to rebound decisively this year after Covid lockdowns in 2022 but a weak property market has undermined consumer confidence, while lagging foreign demand for the country’s exports has hit trade and manufacturing.
Policymakers have responded with cuts to mortgage requirements and interest rates, but have implemented piecemeal stimulus measures in a bid to avoid adding to growing public debt.
State media lauded the Golden Week holiday as a success, noting “bustling scenes” across the country as “the latest sign of . . . China’s steady economic recovery, in stark contrast to the dire predictions made by western media and politicians”.
But initial estimates for domestic tourism fell short of forecasts. The Ministry of Culture and Tourism said