China’s economy contracts for first time since 1976 over COVID-19
Beijing, Apr 17 (efe-epa).- China’s Gross Domestic Product fell by 6.8 percent in the first quarter of the year, the first contraction in the country’s economy since 1976, confirming it was seriously impacted by the coronavirus pandemic, the National Bureau of Statistics (NBS) said Friday.
The Chinese GDP stood at 20.65 trillion yuan ($2,916 billion) in the first quarter of 2020, a year-on-year drop of 6.8 percent.
The contraction, worse than several analysts had anticipated, marks the first disruption of the unprecedented growth that the Chinese economy has recorded in recent decades.
China began measuring its GDP in 1992 but the rest of the existing data to date suggests that the country’s economy had not entered recession for more than 40 years.
Data published by the NBS shows that, in March, when the pandemic began to abate in the country, the economy remained under heavy pressure.
Industrial production fell 11 percent that month from 13.5 percent in January and February, while manufacturing decreased by 10.2 percent.
Retail sales, which tracks consumer spending, declined by 15.8 percent, while investment in fixed assets – such as infrastructure, housing, machinery and equipment – fell by 16.1 percent in the first three months.
The value added of the primary industry decreased by 3.2 percent, that of the secondary industry by 9.6 percent and of the tertiary industry by 5.2 percent.
The first-quarter GDP data confirms the slowdown of the Chinese economy due to the coronavirus pandemic.
Earlier this week, China announced that its foreign trade had declined by 6.4 percent in the first three months of the year.
The country’s economy is still trying to make a full recovery. The Trivium National Business Activity Index estimates that only 82.8 percent of China’s economic capacity is currently being used compared to pre-pandemic levels.
Analysts expect a recovery of the Asian giant’s economy in the second half of the year and the International Monetary Fund predicted two days ago that China will avoid recession and grow at 1.2 percent this year.
In January, before the pandemic erupted, the agency had estimated a 6 percent growth for China in 2020 against the 6.1 percent growth officially recorded by the country the previous year. EFE-EPA