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China was probably the only major economy to grow last year, as it rebounded from COVID lockdowns.
As much of the world grapples with the resurgence of the coronavirus and the economic pain it brings, China has recorded a positive growth rate for 2020, making it likely the only major economy to do so.
But as many of its export markets now face further restrictions as their COVID-19 cases increase, some analysts have predicted that China may not be able to sustain the rapid rebound it has displayed in the end of last year.
For 2020 as a whole, gross domestic product (GDP) grew 2.3 percent from 2019, according to China’s National Bureau of Statistics, faster than the 1.9 percent growth rate projected by the Fund. monetary policy in its October 2020 forecasts.
After the virus first appeared in the city of Wuhan, in central China, in late 2019, it quickly spread, forcing authorities to lock down much of the country and its economy.
GDP declined 6.8% in the first quarter of last year compared to the same period in 2019, but with the lifting of lockdowns, it rebounded 3.2% in the second quarter. It accelerated to 4.9% and then to 6.5% in the third and fourth quarters of 2020 respectively.
The fourth-quarter growth rate exceeded the median forecast of 6.1% in a poll of economists by Reuters news agency.
‘Building momentum’
“The strengthening of the momentum of China’s economic rebound during [the fourth quarter of] The year 2020 reflected improving private consumption spending, as well as strength in net exports, ”said Rajiv Biswas, chief economist for the Asia-Pacific region of research firm IHS Markit, in an email. .
A combination of improving private consumption and growing demand abroad drove China’s growth rate up in the fourth quarter, analysts said.
“Chinese exports of medical equipment and electronics have grown very sharply in recent months, driven by continued demand linked to the pandemic of [personal protective] equipment and computers and mobile devices for working from home, ”Biswas said.
Some analysts have questioned the veracity of China’s economic data, but research firm Capital Economics said the latest figures appear to accurately reflect a strong rebound in the fourth quarter.
“Our internal measure, the China Activity Proxy (CAP), also indicates a clear recovery in growth in the last quarter, despite a more marked slowdown at the start of the year,” Julian Evans-Pritchard, senior economist for China at Capital Economics, said in a note sent to Al Jazeera.
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