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China's economy faces uphill task in

  • October 19, 2020
    China remains cautiously optimistic about its economic growth prospects
    despite the global pandemic, claiming that the world’s second-largest
    economy is steadily recovering from a virus-induced slump. However,
    several roadblocks lay ahead in Beijing’s quest to reach high income
    levels. President Xi Jinping said recently that China’s economy remains
    resilient and that Beijing has adequate policy tools at its disposal,
    despite rising external risks. “The basic characteristics of China’s
    economy with sufficient potential, great resilience, strong vitality,
    large space for maneuver and many policy instruments have not changed,”
    state-run Xinhua news agency quoted Xi as saying. To get more China economy news, you can visit shine news official website.

    “We must seek our development in a more unstable and uncertain world,”
    he said, urging calm amid rising difficulties and challenges. “The great
    rejuvenation of the Chinese nation can never be achieved easily with
    the beating of gongs and drums,” he said. The Asian Development Bank
    said recently that China—where Wuhan, was where the global coronavirus
    pandemic began—was one of the few economies in the region fighting the
    downturn. It forecast China would grow by 1.8 per cent this year and 7.7
    per cent in 2021, with “successful public health measures providing a
    platform for growth”. At a deeper, structural level, however, China’s
    economy is facing an uphill struggle.

    China recorded its lowest GDP growth in almost half a century in 2019,
    at 6.1 percent, and 2020 has only been worse. As the country’s economic
    might began to wilt, Beijing in the first quarter of this year openly
    acknowledged an economic downturn for the first time since 1976, with
    the National Bureau of Statistics announcing on April 17 that the
    economy contracted by 6.8 percent compared to the same period a year
    earlier. Surprisingly, during the annual National People’s Congress of
    the Chinese Communist Party (CCP) on May 22, no GDP growth target was
    announced for the first time in 30 years. Officials cited “great
    uncertainty” caused by the coronavirus pandemic, an acknowledgement of
    the steep challenges the country faces amid a struggling economy and
    increasing international hostility.

    China’s GDP saw double-digit growth every year from 2003 until it peaked
    at 14.2 percent in 2007, but has been in a long decline since then. By
    2018 it had dropped to 6.6 percent, followed by 6.1 percent in 2019.
    However, the COVID-19 pandemic is not to blame for this meltdown; it
    merely aggravated the difficult situation China’s economy was already
    in, but which the CCP has sought to camouflage with its propaganda.
    Experts note an even more serious development. Large banks such as the
    China Construction Bank and the Bank of China recently posted their
    biggest profit declines in a decade. While official figures put the drop
    in GDP at 6.8 per cent, the actual figures are likely to be higher,
    despite—or because of—the government’s US$559-billion (about 736.3
    trillion kyats) revival package.