China's business confidence falls to lowest since Jan 2013: Survey

BEIJING: A survey of sales managers showed that China's business confidence fell to its lowest since January 2013, reflecting the impact of surging Covid cases on economic activity with the abrupt lifting of many pandemic control measures.

Survey results were among the first indicators of how business sentiment has taken a hit in the world's second-biggest economy, after the sharp relaxation of strict Covid containment measures on December 7 triggered a still-growing wave of domestic Covid cases across China.

The World Economics' survey was done on sales managers at over 2,300 companies and was conducted between December 1 and 16 this year.

China's gross domestic product (GDP) is expected to grow just 3 per cent this year, its worst performance in nearly half a century, the survey said.

"The survey suggests strongly that the growth rate of the Chinese economy has slowed quite dramatically, and may be heading for recession in 2023," World Economics said on Monday.

The survey showed business activity fell sharply in December with the sales managers' indexes in manufacturing and service sectors both below the 50 level. The London-based data provider said, "The percentage of companies that claim to be currently negatively impacted by Covid has risen to a survey high, with more than half of all respondents now suggesting their operations are being harmed in one way or another."

According to World Economics, China has recently dismantled some key parts of the world's toughest anti-Covid curbs and lockdowns.

It said the measures were championed by President Xi Jinping but impaired the economy and sparked popular protests unprecedented in his decade-long rule.

The survey said the top leaders and policymakers would focus on stabilising the economy in 2023 and step up policy adjustments to ensure key targets are hit, according to an agenda-setting meeting ended on Friday.