What exactly is going on with China's economy

China's economy is growing despite Corona - but only moderately

Due to the corona crisis, the Chinese economy grew more slowly in 2020 than it has for over four decades. The gross domestic product increased by 2.3 percent compared to the previous year, as the statistics office in Beijing announced. This is the worst performance since 1976, which is due to the historic slump at the beginning of the year as a result of the Corona outbreak. In 2019 it was still enough for an increase of around six percent. Nevertheless, the People's Republic is in a good position, as the other large economies have shrunk according to forecasts by international organizations such as the OECD. According to an initial estimate, the German economy has slumped by 5.0 percent.

Only economy with growth in 2020

According to forecasts, China is the only major economy that did not shrink in 2020. According to the official figures, the economy had recently picked up speed. After a plus of 4.9 percent in the third quarter, it increased by 6.5 percent in the fourth quarter compared to the previous year. Since the most populous country on earth has had the coronavirus largely under control since summer and only counts isolated infections and minor outbreaks, economic activities have returned to normal. This year the upswing is likely to intensify considerably: The International Monetary Fund (IMF) is predicting strong growth of 7.9 percent for China. "We think the prospects for the near future remain good," said economist Julian Evans-Pritchard of Capital Economics. "We still see a lot of potential for consumption, as households will reduce the savings they accumulated last year."

Respirators for the world - here in Heibei

China's growth is helping German companies through the corona crisis

As the Beijing customs authorities announced last week, exports rose by 18.1 percent year-on-year in December alone. Imports had increased by 6.5 percent. "The Chinese economic development in 2020 certainly offered one of the few bright spots in the world," said Max Zenglein from the China Merics Institute in Berlin. The upswing in China helped German companies to compensate for slumps in other markets. The strong export figures can be explained by the fact that the Chinese economy quickly adapted to the new demand situation in other countries. A lot of electronics for setting up home office workplaces as well as medical protective equipment have been supplied from China.

Worry about new infections

New impulses are expected from the new five-year plan, which is to be adopted at the People's Congress in March. The plan starts where China has suffered the biggest setbacks in recent years. The US trade and technology war with China has made the dependence on foreign countries painfully aware. As emerged from the first communications of the leadership of the Communist Party on the new plan, a new economic course is being embarked upon. Domestic demand and own innovation are to be promoted even more.

China wants to make itself more independent from the USA and the rest of the world. Despite the positive outlook, there are warnings of ongoing challenges. According to the expert Zenglein, the corona situation must also be monitored in China. Recently, there had been hundreds of new infections in Hebei province, which surrounds Beijing. "The rising, albeit regionally limited, corona cases will undoubtedly have an impact on demand shortly before the upcoming Chinese New Year celebrations," said Zenglein.

In particular, it is to be expected that the service sector will be affected if travel and restaurant visits are avoided over the holidays. Even if the situation cannot be compared with the previous year, there will be no carefree New Year celebrations in China in 2021 either. The Chinese New Year falls on February 12 this year according to the traditional lunar calendar.

  • Wuhan: One year after the corona outbreak

    Close together

    For around eleven weeks in the spring, Wuhan was isolated from the outside world. The metropolis in central China was the first major hotspot worldwide for coronavirus infections. By mid-May, of the more than 80,000 officially reported cases in China, 50,000 had occurred in Wuhan alone. Almost a year later, street markets are back to life.

  • Wuhan: One year after the corona outbreak

    May i ask

    During the lockdown, some residents were not even allowed to leave their homes. Now the zest for life has returned to Wuhan and couples meet again to dance in the park. For several months there has been no new corona infections in the city that have been transmitted locally, reports the Reuters news agency.

  • Wuhan: One year after the corona outbreak

    Starting point of the pandemic?

    Meat, fish, vegetables, but also wild animals - that was the offer in this market hall in Wuhan. It was closed on January 1, 2020 after cases of mysterious lung diseases increased. These could be traced back to a contact with the market. What role this place played in the outbreak of the pandemic has not yet been finally clarified.

  • Wuhan: One year after the corona outbreak

    His restaurant is his life

    Restaurant owner Lai Yun went to the market hall every day to get goods for the kitchen. "I sent the children to school, had breakfast and went to the market," says the 38-year-old. His restaurant specializes in Japanese food and has been open again since June. But some of its ingredients now cost five times as much. "Our goal for next year is just to survive."

  • Wuhan: One year after the corona outbreak

    Oasis for people who wear glasses

    However, the market hall in Wuhan is not completely closed. While all the shops on the ground floor are barricaded, the shops on the second floor are open. However, only glasses and specialist supplies for opticians are sold there. "Maybe a few people have a queasy feeling, but it's just an empty building now," says a saleswoman, who doesn't want to give her name.

  • Wuhan: One year after the corona outbreak

    Be careful when consuming!

    Fresh food has long been sold elsewhere in Wuhan. Even if these saleswomen wear face masks and gloves, the hygiene here leaves a lot to be desired. Poor cleanliness and spoiled goods were also a recurring issue at the closed market in Wuhan.

  • Wuhan: One year after the corona outbreak

    Only the clown doesn't wear a face mask

    Most of them wear a mask on the street. After corona cases reappeared in some parts of the country, the citizens of Wuhan are also more cautious again, Yen told Deutsche Welle. "We are now using masks again at work," says the 29-year-old English teacher. "A lot of people are starting to hoard mouth guards, disinfectants, and other protective equipment again."

    Author: Uta Steinwehr, William Yang, Goran Cutanoski (picture)

hb / sti (dpa, rtr)