Home Business China’s post-pandemic economic recovery loses momentum

China’s post-pandemic economic recovery loses momentum

Official figures show that the rapid recovery of China’s economy from the coronavirus pandemic is now slowing.

Gross domestic product (GDP) in the second quarter of 2021 increased by 7.9% compared to the same period last year. This was less than half the rate seen in the previous quarter and missed economists’ forecasts of 8.1% growth.GDP is one of the most important ways to show the good or bad of the economy. This is an attempt to measure or measure all the activities of businesses, governments, and individuals in the economy. Official June figures also showed higher-than-expected growth in retail sales and industrial production.“The Chinese economy is maintaining a steady recovery with a recovery in production and demand,” the NBS said in a statement. However, the release issued an additional warning. “The epidemic is changing globally and there is a lot of external instability and uncertainty.”

Chinese workers in toy factory in Jiangsu.

Official figures show that the rapid recovery of China’s economy from the coronavirus pandemic is now slowing.

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Economists have expressed concern about the recovery of the world’s second-largest economy in recent months. Record highs for commodities such as iron ore and copper have helped boost factory inflation to the highest levels in more than a decade.

Energy shortages are also hindering factory production, but we are also experiencing supply chain disruptions as shipping companies are hit by backlogs.

According to official April statistics, the Chinese economy in the first quarter of 2021 grew by a record 18.3% compared to the same quarter last year. This was the largest surge in GDP since China began setting quarterly records in 1992. But after Reuters economist polls predicted 19% growth, that growth was also lower than expected.

n addition, it is significantly distorted compared to last year’s major recession, and there is no strong growth. China’s economy shrank 6.8% in the first quarter of 2020 due to the national blockade at the peak of Covid-19. China’s economy grew by a record 18.3% in the first quarter of 2021 compared to the same quarter last year. This is the biggest leap in the gross domestic product (GDP) since China began to set a quarterly record in 1992. However, Friday’s numbers are lower than expected, with Reuters economist polls predicting 19% growth.

hey are also heavily distorted compared to last year’s huge economic contraction and do not show strong growth.In the first quarter of 2020, China’s economy shrank 6.8% due to the national blockade at the peak of the Covid-19 outbreak. The Chinese economy continues to rebound in pandemics
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“The national economy is off to a good start,” said China’s National Bureau of Statistics, which released its first-quarter data.However, he added, “We must recognize that the Covid-19 epidemic is still widespread worldwide and that international affairs are complicated with a high degree of uncertainty and instability.” ..Other key figures released by China’s statistics sector also show continued recovery, but they are also unusually strong as they are compared to last year’s very weak figures.industrial output in March increased 14.1% compared to a year ago, and retail sales increased 34.2%.

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Analysis box by environmental analyst Roger Harabin
It’s ironic that China’s economic boom has been announced, just as leaders are addressing the challenges of climate change that have been caused by decades of economic growth. Historically, its growth has been driven almost entirely by the emissions from the burning of coal, gas, and oil. China has promised to freeze the increase in emissions by 2030 and stop them altogether by 2060.

However, President Xi has heard from French President Emmanuel Macron and German Chancellor Angela Merkel that emissions can be frozen early, perhaps by 2025.EU and US leaders are also urging China to stop funding new coal-fired power plants in poor countries in the so-called Belt and Road Initiative. They say the world will suffer if African nations follow the path of pollution to prosperity set by coal-rich nations.

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“Promisingly, monthly indicators were industrially produced in March following the weaknesses of the first two months,” said Luis Kais, head of Asian economics at Oxford Economics, a research and consulting firm. , Consumption and investment all suggest that the pace has increased in sequence. ”

However, some analysts predicted that many sectors would slow as government financial and financial support declined.Yaesu, China’s leading economist at The Economist Intelligence Unit, has shown that China’s economic recovery is widespread, but some production and export activities may have been “advanced” in the first quarter. It suggests that future growth will slow down.“The rest of this year’s trade performance and domestic industrial activity may not be able to sustain such strong momentum, as there are no measures to stimulate the domestic economy,” he said.

Chinese consumers buy vegetables
IMAGE COPYRIGHTGETTY IMAGES
Nevertheless, the numbers suggest that China continues to gain momentum in its economy. Comparing the growth of the previous quarter and the fourth quarter of 2020, the growth rate of the Chinese economy was much smaller at 0.6%.

The economy has recovered steadily since the pandemic hit, supported by strict virus containment measures and emergency relief from businesses.Despite this year’s disastrous start, China was the only major economy to record growth in 2020, but it was the weakest in decades, at 2.3%.China set an economic growth target of 6% in 2021 after abolishing last year’s target.

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