According to analysts, in the third quarter of 2020, China’s economy was the only one in the world that managed to stay afloat. It continued recovering after the first wave of COVID-19.
In the given period, the Chinese economy expanded by 4.9% compared to 2019. During the last nine months, the country’s GDP advanced by 0.7%. Economists were a bit disappointed by the real indicator’s rise as they had forecast a jump of 5%. However, the overall dynamic was met with a positive response. Notably, in the first quarter of the year, the country’s economy contracted by a record 6.8% showing the fiercest downturn in almost 30 years. Such a slump was caused by a prolonged lockdown and strict quarantine measures imposed to contain the virus spread. Some economists believe that China is a good example for the whole world.
The Chinese economy has been demonstrating confident revival due to the timely measures taken by the authorities. Moreover, most enterprises were able to return to their normal working rhythm thanks to the rapid response to the virus-induced difficulties. At the same time, the government managed to benefit from the global demand for medical equipment and technologies necessary for remote work. Unlike most other countries, China’s authorities were actively participating in financial issues. Aid to small and medium businesses was under the government control. At the same time, the People’s Bank of China focused on liquidity support.
Despite the fact that the country’s economy was experiencing an uptick, it failed to avoid numerous pitfalls. Of course, China stopped the virus spread, but its consumer activity did not reach pre-crisis levels. The worst performance was logged in such spheres as services, tourism as well as education and travelling.
Mounting corporate and household debts is another issue that needs to be solved. Moreover, the rising unemployment rate also causes concerns. Investors remain cautious as China Evergrande Group, the country's second-largest property developer, reported on climbing debts. The current situation is also aggravated by tensions with the US and other countries.
