2023 China Outlook: Leaping Back to Growth Potential in The Year of The Rabbit

Post Party Congress: Pivot On The Big Three

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Following last October’s National Party Congress (NPC), China’s government is getting back to business to ramp up growth. This means making significant changes to three core issues that have weighed on China’s economy and stock market, which we will analyze in this report:

  • The Shift From Zero COVID
  • US-China Relations
  • Distressed Property Developers & Real Estate Prices

We will also address China’s valuations, fundamentals, and economy relative to both historical averages and other countries.

Both market performance and media headlines around China have been volatile over the past two years. This volatility has led some investors to call China or even broad emerging markets uninvestable. Whether they think China is uninvestable or not, Global investors’ allocations to China are currently at historic lows.1 We believe these underweights could be detrimental to investors’ portfolios in 2023, as they were in 2022 when the CSI Overseas China Internet Index outperformed the S&P 500 and NASDAQ by 1.76% and 16.14%, respectively.2 Higher valuations and rising interest rates in the US could continue to weigh on US equity market performance – just as China could be poised for a rebound.

2023 Outlook Contents:

  • Introduction: Out of Favor?
  • 2022 Review & 2023 Outlook
  • Economy & Markets Outlook: Pivot, Stabilize, and Grow
  • Political Outlook: Pragmatism Prevails
  • Our Best Ideas for 2023
  • Sector Outlook


  1. Data from EPFR as of 11/30/2022
  2. Data from Bloomberg as of 12/31/2022