1、Pol icymakers and investors often refer to battery,new energy vehicl e(NEV)andnrenewabl e energy as the“New Three”of the Chinese economy,in comparisonto the“Ol d Three”such as furniture,home appl iance and cl othing in Chineseexports;or property,infrastructure and processing trade in the overal l ec

2、onomy.NEV and battery production,as wel l as renewabl e energy capex,have seensignificant increases in recent years and are expected to continue growingrapidl y in coming years,adding to headl ine GDP growth in China.Leveraging the framework in our research on green capex,we investigate hownmuch the

3、“New Three”woul d directl y and indirectl y contribute to Chinas GDPover the next five years.Taking NEV as an exampl e,we found that,for each 1tril l ion RMB domestic final demand in NEV production,induced domesticval ue-added woul d be 840bn RMB and induced urban empl oyment woul d beroughl y 2.8mn

4、 persons.Both val ue-added amount and empl oyment impact aresl ightl y smal l er than residential housing construction per yuan of demand.Putting NEV,battery production and wind/sol ar power generation capex together,nour anal ysis suggests that the“New Three”coul d onl y partial l y offset the drag

5、on growth from the property downcycl e(incl uding both through propertyinvestment and upstream sectors,and al so through real estate services,fiscaland consumption channel s).The l ikel y impact on real GDP growth(fromexpanding“New Three”but a shrinking property sector and decl ining traditionalvehi

6、cl e production)is-0.5pp per year from 2023-2027 based on our estimates.Based on our expectation of expanding“New Three”but a shrinking propertynsector and decl ining traditional vehicl e production,the net impact on urbanempl oyment wil l al so be negative.Frictional unempl oyment wil l l ikel y ex