China grew at its slowest rate in 24 years in 2014, according to data released by the National Bureau of Statistics on Tuesday.
The economy expanded by 7.3 percent in the last quarter of the year, and 7.4 percent for the full year. Although that kind of growth would be welcomed by most countries, it falls short of the Chinese government’s target of 7.5 percent for the year. The last time growth dipped below that level was in 1990, although growth was much slower that year, at 3.8 percent.
Few economists were surprised by the slowdown. Even the country’s senior leaders have said they were comfortable with slower, steadier growth, and its president, Xi Jinping, even coined a term for this new slowdown: the “new normal.”
“Yes, China’s economy is slowing, but it’s a natural slowdown after 30 years of rapid growth,” Tao Wang, a China economist at UBS, said. “It still makes China the largest contributor to GDP growth in the world.”
As Ma Jiantang, the head of China’s National Bureau of Statistics, delivered a flood of data Tuesday morning, he said he was satisfied with China’s economic growth in 2014.
“This 7.4 percent was a 7.4 percent that overcame hardship,” he said. “It was a 7.4 percent that overcame pressure. It’s a 7.4 percent that suits the new normal of shifting the gears of the pace of economic development in line with objective laws.”
As part of China’s “new normal,” the government has promised to shift its dependence on heavy investment and government spending. The latest numbers show that Beijing continues to invest in pockets of weakness in the economy, like real estate and exports, albeit it at a slower pace.
Some the key figures released on Tuesday included industrial production, which increased by 8.3 percent in 2014. Recent industrial production figures, a bellwether China’s factories, have pointed to underlying weakening demand.
Fixed-asset investment grew at 15.7 percent in 2014, mainly driven by growing infrastructure investments, which increased 20.3 percent over 2014.
The government is set to ramp up its infrastructure spending, after approving a slew of investment projects to help soften the pace of the slowdown. The National Development and Reform Commission approved new projects totaling more than 1 trillion renminbi, according to HSBC estimates. Many of these projects will start in 2015.
As other parts of the Chinese economy falter, Beijing has turned to consumers to help pick up the slack. Overall retail sales, which has been slowing in recent months, grew by 12 percent over 2014. Online sales, meanwhile, grew by 49.7 percent.
Mr. Ma said that although the statistics showed that traditional industries were running into difficulties, there were also new sources of growth, in particular from the Internet and mobile services.
“This new momentum is rapidly emerging, and that’s where our hope lies,” he added.
Fostering these new and growing sectors of the economy will be crucial for the government in 2015 as the economy downshifts and Beijing tries to wean itself off of credit-fueled investment.
Raising the average household income in China will also be important to kickstart consumption-driven growth.
The national average disposable income for urban citizens rose by 9 percent in 2014 to 28,844 renminbi, or $4,640.51. Rural disposable income grew even faster, at 11.2 percent, to 10,489 renminbi, or $1,686.88.
The number of people in the labor force fell by 3.7 million people in 2014 to 916 million in 2014.
Slower economic growth in 2015 may prompt the Chinese government to ramp up stimulus measures and infrastructure spending. Economists anticipate China’s central bank will cut interest rates at least once this year, as the government attempts to stem a slowdown. Beijing made its first interest rate cut in over two years last November.
As the engine of the global economy, a softening Chinese economy will reverberate around the world.
Asian markets were buoyant on Tuesday. In Hong Kong the benchmark index was up 0.9 percent. In Shanghai, the market gained 1.8 percent. On Monday, the Shanghai Composite suffered its biggest decline since the global financial crisis, closing down 7.7 percent after China’s securities regulator cracked down on borrowing to invest in shares.
An earlier version of this story reversed the growth figures for urban and rural disposable incomes. The national average disposable income for urban residents rose by 9 percent in 2014 to 28,844 renminbi, or $4,640.51; rural disposable income grew 11.2 percent to 10,489 renminbi.