beijing barclays cut its forecast for chinas economic growth next year to 38 based partly on expectations of a drop in global demand for chinese goods the firms us and european economics teams forecast recessions next year barclays hong kongbased jian chang and yingke zhou said in a report wednesday as a result they now expect chinas exports to drop by 2 to 5 in 2023 versus previous expectations for 1 growth the report said chinas share of global exports has been shrinking this year the analysts said foreign companies are seen to have shifted their orders away from china to its asian neighbors including vietnam malaysia bangladesh and india for the production of some key laborintensive goods exports remain an important driver of chinas economy especially when the pandemic disrupted global supply chains and generated intense demand for health products and electronics chinas exports surged by 298 last year in us dollar terms following a 36 increase in 2020 according to the customs agency however the pace of growth has slowed this year as of september yeartodate export growth was 125 the last time chinas exports fell was in 2016 customs data showed barclays new 2023 china gdp forecast of 38 comes after cutting it to 45 in september on falling property investment the analysts latest gdp cut includes expectations for a steeper drop in real estate investment of 8 to 10 versus previous forecasts for a lowsingledigit decline chinas real estate sector and related industries contribute to roughly a quarter of gdp the property market slumped in the last two years as beijing cracked down on developers high reliance on debt for growth while consumer demand for buying houses has plunged stringent covid controls have restricted consumer sentiment overall and hopes that china would soon relax the restrictions helped propel a rally in stocks this week beijing has yet to make any official announcement about changes to its dynamic zerocovid policy even if the country fully reopened the barclays analysts said they remain cautious about how much the consumption and services sectors can recover in china due to rising household debt in fact their analysis found the ratio of chinese household debt to disposable income has in the last few years surpassed that seen in the us in the years leading up to the 2008 financial crisis our base case forecast assumes no big stimulus announcement at least before the december central economic work conference when the newly composed administration will set out its policy priorities the barclays report said as of the third quarter official data show chinas economy has grown by 3 for the year so far thats below the official target of around 55 but close to lowered investment bank expectations for 2022