China's economy in the July-September period expanded a real 4.9 percent from a year earlier, official data showed Wednesday, its growth decelerating from 6.3 percent in the previous quarter amid a prolonged property sector crisis.

The year-on-year increase in gross domestic product of the world's second-largest economy was slightly below the country's growth target of around 5.0 percent for 2023. On a quarter-on-quarter basis, China's GDP saw a 1.3 percent expansion compared with a revised 0.5 percent growth in the April-June period.

Sheng Laiyun, deputy head of China's National Bureau of Statistics, holds a press conference in Beijing on Oct. 18, 2023. (Kyodo)

The National Bureau of Statistics said the country's economy "sustained the momentum of recovery and improvement with solid progress in high-quality development, which has laid a strong foundation" for achieving the annual growth target.

However, it warned that the external economic environment is "becoming more complex and grave." Sheng Laiyun, a spokesman of the bureau, said domestic demand "remains insufficient" and that the foundation for economic growth and recovery "needs to be further consolidated."

In the second quarter of this year, China's year-on-year GDP growth accelerated from 4.5 percent in the previous three months, which was due in large part to a two-month COVID-19 lockdown in Shanghai in the corresponding period last year.

China's economic recovery has been affected by a slump in its real estate sector, with major property developers China Evergrande Group and Country Garden Holdings Co. saddled with heavy debts.

The real estate market accounts for some 30 percent of China's GDP. Evergrande filed for bankruptcy in a New York court in August.

In the first nine months of 2023, investment in real estate development dropped 9.1 percent from a year earlier. Industrial production grew 4.0 percent, while retail sales of consumer goods rose 6.8 percent and fixed asset investment increased 3.1 percent.

China's central bank cut its benchmark lending rate in August for the second time this year to shore up the economy.

In 2022, China's GDP expanded 3.0 percent -- marking one of its slowest growth rates in several decades -- missing its initial goal of around 5.5 percent under the country's stringent "zero-COVID" policy that restricted people's movements and disrupted supply chains.

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