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China’s economy shrinks for the first time in 28 years

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Aljazeera
Aljazeera
  1. The coronavirus pandemic brought huge repercussions for the economies. All the economies around the world are facing recession. China, from where coronavirus originated had a disastrous effect on economies. China’s economy shrank by 6.8% in the first quarter of 2020.

On the first three months of 2020, China’s economy faced many hurdles when they went for extensive shutdown to contain the virus. The data released by the National Bureau of Statistics (NBS) on Friday confirmed the slump, which was worse than predictions of minus 6.0 per cent from a survey of analysts’ forecasts by Bloomberg.

The data released by NBS showed that the month of march, China’s economy was facing huge pressure, when all industrial sector, fixed assets were shrinking. This is the first time after 1992 that China’s economy was dragged so low. On a quarter on quarter basis, the GDP fell 9.8% in the first three months of 2020.

While China has also again, managed to restart the economy, which is running standstill from February. “The March data add to broader signs that China’s economy is past the worst. But the recovery will probably continue to underwhelm,” said Julian Evans-Pritchard, senior China economist at Capital Economics in a note to clients seen by Al Jazeera.

China’s urban jobless rate was 5.9% in March, down from 6.2% in February. The data released on Friday, also showed that China’s retail sales have fallen nearly 15.8% in March. The lights are turning back on, people are working … so end consumption will recover,” Stephen Innes, Asia Pacific market strategist at AxiCorp told Al Jazeera.

The second largest economy will be badly effected by the pandemic as the world has gone in a lockdown, and experts assume that more than 30 million people will lose their job. For 2020 China’s economic growth will increase at a very slow pace.

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