China’s Economic Turnaround From Corona is Steadily Falling
As global cases continue to rise, countries are slowly trying to adapt and move forward while still being cautious. People are growing more and more aggravated by the conditions they themselves and their families are being subjected to. The pandemic forced cities to shut down and party-goers to stay home. But one major country is opening again: China.
The Chinese economy has expanded 3.2 percent from April to June compared the same period of time last year. Part of the recovery is due the authoritarian government’s control with widespread testing and travel restrictions. But the rebound also reflects how the government continues to rely on spending money on building highways and rail lines and other infrastructure projects to increase the economy, rather than on domestic consumption.
The sales of foods and other essentials have stayed strong in China throughout the pandemic. But the masses are still hesitant to spend on luxuries such as hotels, restaurants, and other nonessential services.
That approach raises doubts about whether China’s economic turnaround can be sustained and whether it could eventually be the push needed to drive the global economy out of decline.
The demand for China’s exports have decreased as unemployment rates and recession grows in other countries. Factories in China are mass producing furniture, consumer electronics, and cars for the consumers at home. But people are not consuming as much as previously and China is producing items faster than they are bought. There is much speculation on whether China’s exports can hold up at a time when many stores are struggling in the West.
China’s economy has shown “development and resilience,” said Liu Aihua, the bureau’s director general of the department of comprehensive statistics, at a news briefing. But, she warned, “the national economic recovery was still under pressure.”
The growth of the economy was started by a ramping up of infrastructure investments. Beijing was quick to approve bonds given by local governments to build subway lines and to make renovations. However, millions of young Chinese people are still out of work. The government addressed this issue by sharply expanding the number of places in graduate schools and redefining employment to include bloggers and professional video gamers.
The economic impact of the coronavirus poses a challenge to the ruling Communist Party and its efforts to make good on a promise by Xi Jinping, the Chinese leader, to eradicate extreme poverty by the end of this year. Ms. Liu said that 5.51 million of China’s 1.4 billion people were still counted as very poor at the end of last year.