China's economy rebounds amid pandemic

China's GDP has grown 3.2% year on year in the second quarter (Q2) as the country recovers from the COVID-19 pandemic and reopens the economy.

   

At a press conference held by the State Council Information Office on Thursday, the National Bureau of Statistics (NBS) announced that the rebound came after a 6.8% drop in the first quarter, as the world's second largest economy continues to navigate the aftermath of the coronavirus lockdowns.

Based on preliminary calculations, China's GDP in the first half of the year registered 45.66 trillion yuan (US$6.53 trillion), down by 1.6% year on year.

According to the NBS, major economic indicators picked up from April to June. Specifically, the value added of industrial enterprises above the designated size grew by 4.4% following a drop of 8.4% in the first quarter; the value added of the service industry rose 1.9% following a 5.2% drop in Q1; and the drop of retail sales of consumer goods narrowed 15.1 percentage points compared to Q1. 

Employment and consumer prices also stabilized, NBS spokesperson Liu Aihua said. In the first half of the year, China's urban areas saw an increase of 5.64 million jobs, accounting for 62.7% of the annual target. In June, the surveyed unemployment rate in urban areas was 5.7%, marking a drop in two consecutive months. The consumer price index grew by 3.8% in H1, 1.1 percentage points lower than the Q1 level. 

Emerging industries are gathering momentum. In the first half of the year, the value added of high-tech manufacturing industry grew by 4.5%, accounting for 14.7% of all the added value of industrial enterprises above the designated level, up 0.9 percentage points year on year. 

Investment in the high-tech manufacturing and service sectors also grabbed the spotlight with the pharmaceutical industry and e-commerce industry growing by over 10% and 30% respectively. Retail sales of goods from online channels grew by 14.3%, accounting for 25.2% of retail sales of all consumer goods, up 5.6 percentage points year on year.

As the COVID-19 pandemic continues to unfold worldwide and with other countries struggling to reopen their economies and tackle the pandemic, China's efforts to stabilize economic growth is bound to face some challenges, Liu said. 

But with a complete set of industry system, improved infrastructure, a huge market, and sufficient macro policy adjustment, China has the resilience to navigate the COVID-19 impact and sustain economic recovery, she said.