Business & Economy

China says recent Covid outbreaks hurt economy more than in 2020

Beijing, May 26 (EFE).- China’s premier has acknowledged that recent Covid-19 outbreaks in the country have impacted its economy more than at the start of the pandemic in 2020 and called for reconciliation of harsh containment measures with policies to stabilize the economy and employment.

During a national teleconference by the State Council – China’s cabinet – on Wednesday night, Li Keqiang admitted that “the difficulties in March, and since April in particular, are in some respects and to a certain extent greater than those experienced in 2020 when the Covid-19 epidemic hit the country,” state-run news agency Xinhua wrote.

The premier cited, as an example, the declines in indicators for employment, industrial production, power consumption and cargo transport and urged efforts to keep the economy running “within an appropriate range.”

China’s international trade posted a year-on-year growth of 0.1 percent in April, a significant slowdown compared to its 5.8 percent expansion in March.

Moreover, retail sales, which showed a growth of 4.8 percent in the first quarter of the year contracted by 3.5 percent year-on-year in March and the official unemployment rate in urban areas stood at its lowest level in the last 22 months: 5.8 percent, 0.3 points over the figure posted in February and the target of 5.5 percent set by Beijing for this year.

A major contributor to this situation has been the prolonged lockdown of Shanghai, China’’ financial capital, whose 26 million inhabitants have spent two months in lockdown with many still confined.

Most of the companies in the city have also stopped operations or are operating at minimum capacity.

In his remarks, Li emphasized the need for the implementation of policies to stabilize the economy and support market entities, employment and people’s livelihoods.

He added that development was the key to solving all problems in China and urged swift actions from now on to bring the economy back on track, according to Xinhua.

Li pointed out that the government has undertaken several “effective” measures in response to the difficulties and challenges arising this year due to “unexpected factors” but called for efficient coordination of steps taken to control the epidemic with socioeconomic development, and for more importance to be given to the stabilization of growth.

The Chinese premier also ordered government departments to implement, by the end of May, the 33 measures recently approved by the State Council to stabilize the economy, and for local authorities to adapt them to their specific conditions.

To ensure the latter, Li announced that the State Council will send task forces to 12 provinces starting Thursday to monitor the work of local authorities in enforcing these measures.

“Local governments should treat all kinds of market entities equally, continue to smoothen logistics and industrial chains to promote work and production resumption, and ensure the timely distribution of unemployment insurance and social assistance funds to people in need,” he stressed.

The Chinese government has set a growth target of 5.5 percent for 2022, among the lowest in decades. EFE


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