DM Monitoring
BEIJING: China’s economic growth is expected to equal pre-COVID-19 levels in the last quarter of 2020, and Beijing will ramp up efforts to help businesses still in distress and promote a more balanced recovery, experts said.
The Chinese economy will likely soon be confirmed as the world’s only major economy to have achieved positive growth during COVID-ravaged 2020, as the nation is scheduled to unveil GDP and other key economic data for the full year and the fourth quarter on Monday.
Experts expected the economy to grow by more than 2 percent in 2020 on the back of a rally in investment and strong exports, with full-year GDP exceeding 100 trillion yuan ($15.45 trillion) for the first time. Fourth-quarter economic growth may be about 6 percent, the level seen in the last quarter of 2019, prior to the nationwide COVID-19 outbreak.
Liu Yuanchun, vice-president of the Renmin University of China, said the country’s achievement in combating the pandemic and promoting economic recovery has demonstrated the country’s institutional advantage and economic resilience, laying a good foundation for embarking on the 14th Five-Year Plan period (2021-25).
But a GDP growth figure reaching pre-COVID-19 levels does not point to a full economic recovery, experts said, as hard-hit sectors continue to feel pressure, especially small manufacturers and services providers. “It is too early to conclude that this is a full recovery,” said Iris Pang, chief China economist at Dutch bank ING.
External demand has not fully recovered and could restrict China’s industrial production, especially for smaller manufacturers, Pang said, adding that industries linked to international travel are still in a difficult situation. December’s official manufacturing purchasing managers index indicated that small manufacturers saw a contraction in activity, though the overall manufacturing sector continued to expand, according to the National Bureau of Statistics. Looking at 2021, growth figures are expected to rebound strongly from a year earlier thanks to a low comparative base for 2020, but the underlying improvement momentum may be subject to uncertainties and could leave some small businesses and employment situations remaining under pressure, experts said.
