Goldman Sachs cut its 2023 economic growth forecast for China sharply, predicting Beijing will stick to its stringent COVID-Zero policies through at least the first quarter of next year, reports Bloomberg. Gross domestic product will probably increase 4.5% in 2023, down from a previous projection of 5.3%, Goldman’s economists led by Hui Shan wrote in a note. This year’s prediction of 3% was maintained.
China is unlikely to begin reopening before the second quarter of next year as it tries to put several steps in place first, such as higher vaccination rates for elderly and increased manufacturing of cheap and effective COVID pills, Goldman said.
The authorities may also want to wait until after the Lunar New Year peak travel season and next March’s parliament session when the reshuffling of government officials is completed, before exiting the COVID-Zero strategy, the economists wrote.