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Hong Kong
CNN
 — 

China’s economy grew stronger than expected at the start of this year, mainly thanks to robust growth in high-tech manufacturing.

Gross domestic product grew by 5.3% in the first quarter from a year ago, according to the National Bureau of Statistics on Tuesday. That beat the estimate of 4.6% growth from a Reuters poll of economists. It also marked an acceleration from the 5.2% growth in the previous three months.

“The Chinese economy got off to a good start in the first quarter … laying a good foundation for achieving the goals for the whole year,” said Sheng Laiyun, a spokesperson for the NBS, at a press conference in Beijing accompanying the data release.

But he acknowledged that “the foundation for economic stability and improvement is not yet solid.”

Industrial production jumped 6.1% in the first quarter from a year ago,  mainly thanks to strong growth in high-tech manufacturing.

In particular, the production of 3D printing equipment, charging stations for electric vehicles and electronic components all surged about 40% compared to a year earlier.

Last month, an official survey showed China’s manufacturing purchasing managers’ index (PMI) expanded for the first time in six months. The Caixin/S&P manufacturing PMI, a privately run survey, also hit its strongest reading in more than a year, as overseas demand picked up.

China has set an annual growth target of around 5% for 2024, which many analysts considered ambitious, as consumer and business confidence remains weak and the real estate sector is mired in a prolonged downturn.

The authorities have cut interest rates this year to boost bank lending and speed up central government spending to support infrastructure investment.

Tuesday’s data showed that retail sales grew 4.7% in the January-to-March period, boosted by spending in sports and entertainment activities, cigarettes and alcohol, as well as catering services.

Investment in fixed assets — such as factories, roads and power grids — increased 4.5% during the same period.

But that growth was mainly supported by state-owned enterprises, which invested 7.8% more in the first quarter from a year ago. Investment by the private sector increased only by 0.5%.

Investment by foreign companies plunged by 10.4% in the first quarter.

Beijing has made reviving economic growth its top priority for this year and has renewed its efforts to woo foreign investors.

Last month, Chinese leader Xi Jinping met more than a dozen US CEOs and academics in Beijing and invited them to “continue to invest in China.” He expressed confidence that the country will maintain a healthy and sustainable growth in the coming months.

China’s economy grew 5.2% in 2023. While this expansion marked a significant pick-up compared to 2022, when China’s economy grew by just 3% amid intense coronavirus lockdowns and disruption, it was still one of the country’s economic worst performances in over three decades.

Foreign direct investment in China has slumped in recent months as a combination of slower growth, regulatory crackdowns, onerous national security legislation and questions about the country’s long-term prospects have shaken confidence in the world’s second biggest economy.

This is a developing story and will be updated.