China’s economic growth shrank significantly in the second quarter of the year mainly due to the zero-infection policy that often paralyzes the economy.
According to the Chinese statistical agency, in the second quarter of the year (April-June) growth was 0.4%, while in comparison in the first quarter it had reached 4.8%. Consequently, the growth of the Chinese economy in the first half of 2022 is around 2.5%.
Fu Linghui, a spokesman for China’s National Statistical Service, said: “Faced with an increasingly complex and demanding international environment, as well as multiple outbreaks of the pandemic at the local level, economic growth experienced unusual pressures during the April-June period.”
The policy of zero cases has resulted in the imposition of a lockdown in the most important economic centers of the country, such as in Shanghai, which paralyzed the two months of April-May with significant effects on the Chinese economy. It should be noted that during this period even the port of Shanghai operated with great restrictions.
Stimulating the economy is no easy task
According to the representative of the Chinese Statistical Service, the limitation of growth in China is also due to the negative international circumstances: “The risk of stagnant inflation in the global economy is increasing, the monetary policy of the most important economies is restrictive and the general uncertainty is also affecting the Chinese economy. The pandemic remains an unstable factor, which shrinks demand and causes supply problems. What is required is to strengthen the foundations for a sustainable and stable recovery of the economy.”
Despite the anemic growth of the Chinese economy, Beijing appears to be sticking to its ambitious 5.5% growth target for 2022. In late June, President Xi Jinping announced a bold economic boost to local governments aimed at boosting construction activity. With this old classic recipe, Beijing intends to breathe new life into the country’s economy. This week, however, Chinese Premier Li Keqiang admitted that stimulating the economy is no easy task.
Stefanos Georgakopoulos (Afp, dpa)
Source: Deutsche Welle
Source: Capital
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