WATCH: China in the Year of the Tiger

China’s property sector continues to hold the key to its economic recovery, ANZ’s Chief Economist Greater China Raymond Yeung says, as the country maintains its zero tolerance to COVID-19 cases.

Speaking on video ahead of the Lunar New Year, Yeung said the property sector - which represents a quarter of the country’s annual gross domestic product – would be critical to how China continues its post-pandemic recovery.

“Beijing is uncompromising in zero-tolerance [approach to COVID],” he said. “And we believe China will stick to this policy stance in the Year of the Tiger.”

“Now the question is, is China still a global growth engine? And can GDP rise by more than five percent?”

Yeung made the comments on a panel with ANZ Senior Economist Greater China, Betty Wang and Senior China Strategist Zhaopeng Xing. You can watch a video of the discussion below.

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Wang said China’s developers face a tough first quarter and relief may not be immediate.

“We may see deteriorating business operations before the sector gets some respite later in the year,” she said. “We believe the government will have to launch more measures to stabilise market sentiment in the near term. The risk, though, is to withdraw supportive policies too early.”

Xing said Chinese policy makers would use a combination of other measures to support growth this year.

“After the rate cut in January, we don't expect the central bank to cut interest rates again,” he said, on the back of the stability of the RMB exchange rate.

He said the government was likely to increase investment in areas such as infrastructure, affordable housing and sustainability.

Watch the video above to find out more.