The outbreak of the Russian Ukrainian war has brought new downward pressure on the global economy and increased external uncertainty. To this end, China's macro policies will further tilt towards supporting economic growth, stabilize market expectations, and create a stable and healthy economic environment for China's major political agenda. We expect that the GDP growth target in 2022 will be set at 5.0-5.5%, and the annual economic growth is expected to be 5.6%, up 0.3 percentage points from the previous expectation.
On February 24, the war between Russia and Ukraine broke out in an all-round way. Judging from the current process, the duration of the war is being extended from the previously widely expected "days" to "weeks" and even "months". Considering that Russia and Ukraine play an important role in global energy and Shenzhen Agricultural Products Group Co.Ltd(000061) trade, and the sanctions against Russia initiated by western countries are still likely to be further upgraded, and even the possibility of comprehensively restricting the export of Russian crude oil and natural gas is not ruled out, the negative impact of this war on the global economy is emerging, and the consequences will depend on how long it will last. Under the expectation that the war will not end in a short time, we expect that in April, the International Monetary Fund (IMF) will lower the global GDP growth forecast for 2022 by 0.5 percentage points to 3.9%, and the eurozone will bear the brunt; Referring to the impact of the Gulf War in 199091 and the Iraq war in 2003 on the international oil price at that time, we estimate that the Russian Ukrainian war will push up the global oil price to 140 US dollars / barrel around the middle of the year, which is about 90% higher than the average international crude oil price (Brent crude oil spot price, 74.17 US dollars / barrel) in December 2021 before the war. This will lead to a significant rise in global energy prices, which will have an effect of "pushing up inflation and driving down growth" on the global economy, which is difficult to repair in the later stage of the epidemic.
What impact will this war have on China's policy direction and macroeconomic operation
At present, the direct impact of the Russian Ukrainian war on China is mainly reflected in oil and gas prices - the national development and Reform Commission has raised the prices of Chinese gasoline and diesel by 260 yuan and 255 yuan per ton since March 4. According to the estimation of 50L fuel tank capacity of general household automobile, filling a box of No. 92 gasoline will cost 10 yuan more. "PPI looks at oil". Under the expectation that the international crude oil price will continue to rise, the time for China's PPI to hover at a high level of more than 5.0% year-on-year this year will be further extended to the third quarter. At present, this is unlikely to change the situation that CPI will only rise moderately year-on-year this year, but the higher than expected rise in the price of upstream raw materials will bring new cost pressure to many downstream small and micro enterprises. Given that small and micro enterprises are the main force to absorb employment, targeted support measures such as fiscal tax reduction and fee reduction and financial credit transfusion will be further strengthened in the short term.
It should be noted that the fluctuation of overseas epidemic combined with the outbreak of the Russian Ukrainian war means that the external uncertainty has further increased this year. While pushing up China's energy prices and weakening foreign demand, it may also have a subtle impact on China's investment and consumer confidence. Considering that under the combined action of slow consumption, real estate downturn and other factors, China's macro economy itself is facing certain downward pressure. New uncertain factors will urge the policy to pay more attention to stable expectation and steady growth, so as to create a stable and healthy economic environment for the 20th National Congress in the second half of the year.
