Positive GDP, but the lowest for more than 40 years: China saw 2.3% growth last year despite the Covid-19 pandemic, while most major economies are still in recession.
The first country affected by the epidemic, China experienced a historic decline in its growth in the first quarter of 2020 (-6.8%), following unprecedented control measures that weighed on activities.
The gradual improvement of sanitary conditions since the spring, however, has enabled the return of gross domestic product (GDP). In the last quarter, it recorded a growth of 6.5% in one year, which is its level before the pandemic, the Central Bureau of Statistics (BNS) said on Monday.
Throughout 2020, China recorded growth of 2.3%.
That’s a figure higher than analysts ’predictions polled by AFP (+ 2%). But this performance is much lower than in 2019, when Chinese growth was 6.1%, which is already at its lowest level in almost three decades.
Unlike most other countries expected to predict a recession, “the Chinese economy enjoyed an enviable trajectory for most of 2020,” said analyst Xiao Chun Xu of rating agency Moody’s.
Although questionable, the official growth figure in China is still under scrutiny, given the country’s weight in the global economy.
– “Serious and complex” –
The recovery in activity in China was particularly noticeable at the end of the year, due to “very strong demand” abroad for medical products and teleworking equipment (especially computers), IHS Markit analyst Rajiv Biswas told AFP.
In December, world workshop industrial production reached its highest growth rate in 2020, growing 7.3% year on year.
As a sign of the impact of the pandemic, industrial production grew by only 2.8% during the year as a whole, the lowest value at least since the turn of the century.
Retail, the main indicator of consumption, slowed last month, increasing by only 4.6% year-on-year, compared to 5% in November.
The Chinese economy “has faced a serious and complex situation both at home and abroad […] especially because of the huge consequences of the “Covid-19 epidemic,” admitted Ning Jizhe, an official with the Central Bureau of Statistics (BNS).
The 2.3% result, which Western economies may envy, is the lowest rate for China since the end of the 1976 Maoist era.
– Penalty services –
In terms of employment, the unemployment rate, measured in China only in urban areas, was 5.2% in December (unchanged from November).
This figure, which is specifically monitored by the government, excludes from its calculation millions of migrant workers, weakened by the pandemic.
The unemployment rate reached its highest level in February 2020 of 6.2% of the urban workforce.
China has largely stopped the coronavirus epidemic on its soil through tests, locking, quarantine and tracking movements.
Life has returned to normal, except for new outbreaks in the region bordering Beijing and in the country’s northeast, where authorities have re-established strict quarantine measures.
Certain sectors, especially services, continue to be punished by fear of viruses. This is the case with the hospitality industry: sales fell by 16.6% throughout 2020.
And the trend could continue this year in the event of deteriorating sanitation in China, warns analyst Ting Lu of investment bank Nomura.
The International Monetary Fund (IMF) has warned that the effects of the virus are still severe, especially on domestic demand.
The institution lowered its growth forecast for China by 0.3 points this year, to 7.9%.