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China Economic Quarterly Q4 2019

Slower growth rate in Q4 and the outbreak of COVID-19 calls for more stimulus policies and uncertainty may drag down global economy.

This issue provides an overview of the macroeconomic trends in Q4 2019, some policy updates and hot topic analysis.



Here are some macro-economic highlights:

  1. GDP growth increased by 6.1% in 2019
  2. Total fixed asset investment reached 55.15 trillion yuan, expanding by 5.4%
  3. Total real estate investment increased by 9.9%
  4. PMI rebounded to above the threshold of 50%
  5. The growth of industrial added values rose by 5.7%
  6. Total retail sales of consumer goods went up by 8.0%
  7. Imports and exports increased by 3.4%
  8. PPI decreased by 0.3% and CPI increased by 2.9%


Policy updates & hot topic analysis

Aggregate financing went up by 10.7% in 2019.

According to data from the People’s Bank of China, by the end of 2019, total aggregate financing to the real economy (AFRE) reached 251.31 trillion yuan, and went up by 10.7% year on year. The cumulative amount of ARFE growth was 25.58 trillion yuan in 2019 or 3.08 trillion yuan more than in 2018.


Fiscal spending went up by 8.1% in 2019, while the fiscal deficit rate increased to 4.89% of GDP.

In 2019, the general public budget revenue increased by only 3.8% to 19.04 trillion yuan, which was the lowest growth rate in 30 years due to slower GDP growth. Furthermore, as a result of policy measures of cutting taxes and fees, the growth rate was much less than in 2018 when it was 6.2%. Total general public budget revenue in 2019 was 0.7 trillion yuan more than in 2018.

Hot topic analysis: The facts and implications of Yangtze River Delta integration

In December 2019, China’s central government unveiled the “Outline of integrated development of Yangtze River Delta”, a comprehensive report to describe the blueprint of the region’s development by 2025. It has officially documented the Yangtze River Delta (YTD or the Delta) integration as one of the national development strategies, while others include the Belt and Road Initiative, Beijing — Tianjin — Hebei (or Jingjinji) Collaborative Development, Yangtze River Economic Belt (a much larger area than the Yangtze River Delta), and Guangdong — Hong Kong — Macao Greater Bay Area (the Greater Bay Area ).

  • The region has a quarter of the national GDP, and its economic size in 2019 was greater than the world's fifth largest economy, UK.
  • The region has a quarter of China's total government tax revenue.
  • The region has one third of China's exports and imports.
  • The Delta fosters 38% of the top 500 private enterprises and is the #1 destination for FDI.
Implications and opportunities
  • Achieving integrated development of the area
  • The major objectives or development goals for Yangtze River Delta integration by 2025 indicate enormous business opportunities for environmental protection, urbanisation, R&D, infrastructure and telecommunications, education, healthcare, the digital economy, and energy.
  • Yangtze River Delta integration will reinforce the leading role of Shanghai, particularly its service function, through preferential policies, and will also create new opportunities for the Shanghai Free Trade Xone including Lin-Gang Special Area which is home to Tesla's Gigafactory 3.

Previous issues of China Economic Quarterly

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Elton Yeung

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