JAKARTA (TheInsiderStories) – Chinese economy fall off to 6.8 percent in the first quarter (1Q) of 2010 due to COVID-19 crisis, the lowest level since 1992, the National Bureau of Statistics reported today (04/17). Quarter-on-quarter growth of GDP in 2019 and the first quarter of 2020 were 1.6 percent, 1.5 percent, 1.3 percent, 1.5 percent, and -9.8 percent respectively.
“According to the preliminary estimates, in the first quarter of this year, the gross domestic product (GDP) of China was RMB20,650.4 billion, a year-on-year decrease of 6.8 percent at comparable prices,” the agency said in a written statement.
By industry, the value added of the primary industry was RMB1,018.6 billion, down by 3.2 percent, secondary industry was RMB7,363.8 billion or down by 9.6 percent, and that of the tertiary industry was 12,268.0 billion yuan or plunged by 5.2 percent.
“Generally speaking, the overall national economic and social development in the first quarter maintained stable despite the outbreak of COVID-19,” the statement stated.
However, the country should also be aware that given the continuous spread of the epidemic globally, mounting downward pressure of the world economy, and remarkably increasing instabilities and uncertainties.
It stated, “We are now facing rising pressure of the prevention of imported epidemic infections and new difficulties and challenges for resuming work and production and advancing economic and social development.”
For the next step, said the agency, China must fully implement the decisions and arrangements made by the the government, further coordinate efforts to advance both epidemic prevention and control and economic and social development, and enhance policies implementation to resume work, production, market and business.
Earlier, International Monetary Fund has warned the impact of the coronavirus is having a profound and serious impact on the global economy and has sent policymakers looking for ways to respond. China’ experience so far shows that the right policies make a difference in fighting the disease and mitigating its impact—but some of these policies come with difficult economic tradeoffs.
In the world second largest economy’ case, policymakers implemented strict mobility constraints, both at the national and local level, at the height of the outbreak, many cities enforced strict curfews on their citizens. By all indications, China’ slowdown in the first quarter of 2020 will be significant and will leave a deep mark for the year.
While there are reassuring signs of economic normalization in China—most larger firms have reported reopening their doors and many local employees are back at their jobs—stark risks remain. This includes new infections rising again as national and international travel resumes.
Even in the absence of another outbreak in China, the ongoing pandemic is creating economic risks. For example, as more countries face outbreaks and global financial markets gyrate, consumers and firms may remain wary, depressing global demand for Chinese goods just as the economy is getting back to work.
Therefore, Chinese policymakers will have to be ready to support growth and financial stability if needed. Given the global nature of the outbreak, many of these efforts will be most effective if coordinated internationally.
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