21st June 2023: economic and unemployment data in May, Premier’s visit to Europe

This episode covers industrial production, retail sales and unemployment data in May; foreign direct investment (FDI) in China in the first five months of 2023; and Chinese Premier Li Qiang’s visit to Germany. From the Chamber side, the Business Confidence Survey 2023 was released on 21st June and is available to download here.


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Read more:

Official macroeconomic data May (in Chinese):





Official FDI data January-May (in Chinese):



Li Qiang in Europe:


European Business in China Business Confidence Survey 2023



RUI: Hello and welcome to China Shortcuts,

MARIANN: the European Chamber’s weekly catchup on China’s business landscape.


RUI: On 15th June China’s National Bureau of Statistics disclosed a new dataset showing that the growth of industrial production and retail sales both slowed in May.

MARIANN: Production at the country’s larger industrial firms expanded 3.5 per cent year-on-year, which was the slowest pace recorded in the past three months. Growth was relatively strong among state-owned and foreign-invested companies compared to joint-stock and private-owned businesses. Out of the 41 sectors surveyed for the data collection, 21 reported growth, with the automotive industry among the sectors expanding at the fastest rate in May.

The year-on-year growth in retail sales was still relatively strong at 12.7 per cent, but the pace was below expectations and weaker than in April. Since the data came on top of a low base from the same period last year, it suggests a potential weakening of the growth momentum that followed China’s post-Covid reopening.


RUI: As part of the dataset released on 15th June, the National Bureau of Statistics also released data on unemployment, with urban youth unemployment soaring further in May.

MARIANN: While overall unemployment remained at 5.2 per cent for the second month in a row, urban youth unemployment hit a new record, reaching 20.8 per cent in May. As Fu Linghui, the bureau’s spokesperson explained, there is around 33 million people in the 16 to 24 age group who live in China’s cities and are employable, and the data suggests that about one fifth, or over 6 million, of them are out of a job. With a record 11.58 million graduates set to enter the job market this year, the youth jobless rate is likely to increase further in the coming months.


RUI: According to data released by the Ministry of Commerce on 15th June, in the first five months of 2023 the actual use of foreign direct investment or FDI in China expanded at the slowest pace in almost two years in RMB terms.

MARIANN: The year-on-year growth of FDI shrank to 0.1 per cent in the January to May period. This was the weakest reading since June 2020. In US dollar denominated terms, the actual use of FDI in China dropped 5.6 per cent compared to the same period last year. In its short statement, the ministry highlighted that certain sectors attracted more overseas investment: FDI flows into high-tech manufacturing increased more than 30 per cent year-on-year in the first five months of the year. During the same period, investments from France grew more than four times compared to last year. In a written answer to a question from media, the ministry added that in the January to May period, over 18 thousand new foreign-invested companies were set up in China, which is 38 per cent more than in the same period last year.


RUI: Chinese Premier Li Qiang arrived in Germany on 18th June, where he started his first overseas trip since taking office in March. He is scheduled to visit France as well, and will hold high-level meetings with political and business leaders in both countries.

MARIANN: On 19th June, Premier Li attended a seminar with representatives of the German business community in Berlin. At the event, he emphasised that mitigating risks and cooperation are not mutually exclusive. Li’s visit is taking place against the backdrop of the European Union’s discussions about de-risking instead of decoupling from China.


RUI: On 21st June, the European Chamber released its European Business in China Business Confidence Survey 2023 in partnership with Roland Berger. The annual survey’s findings show that the deterioration of business sentiment that has taken place over the last three years has been significant.

MARIANN: Faced with growing risks and a more volatile operating environment, European companies have begun adjusting their investment and operational strategies to ensure they do not have too many eggs in their China basket. Some companies have already shifted existing investments out of China, and some moved their Asia or business unit headquarters from the Chinese Mainland, while others are planning to do so.

RUI: Download the full report from our website for free to find out more about the different steps European businesses are taking to increase their supply chain resilience and maintain their profitability in the face of heightening geopolitical risks and the Chinese Government’s ongoing technological self-reliance campaign.


MARIANN: Thanks for listening. Tune in again next week.

RUI: In the meantime, please find useful links in the episode notes.

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