China’s GDP to expand 2% in 2020: experts

By Xie Jun and Yin Yeping Source: Global Times Published: 2020/11/16 20:08:40

Pick-up in October leads to upbeat projections

A night view of Guomao, an area at the center of Beijing's CBD Photo: VCG

China's economic recovery continued to gain impetus in October, reflected by faster growth in domestic consumption and factory output, and experts predict the economy will grow faster in the fourth quarter than the third, and the full-year expansion is likely to readh 2 percent year-on-year. 

Data released by the National Bureau of Statistics (NBS) on Monday showed that factory output rose faster than expected in October, while retail sales continued to recover. Industrial output climbed 6.9 percent in October, in line with September's gain. A Reuter poll had expected a 6.5-percent rise. 

The rebound again showed China's economic resilience despite the COVID19 onslaught earlier, experts said. 

"China's role as the world's factory strengthened after the pandemic was largely brought under control, while production in many other countries including the US is still being disrupted by the outbreak," Tian Yun, vice director of the Beijing Economic Operation Association, told the Global Times on Monday. 

Other data of services and fixed-asset investment also showed the economy is rebounding rapidly. In October, retail sales rose 4.3 percent year-on-year to reach 3.85 trillion yuan ($585.8 billion), or 1 percentage points faster than September. 

The consumption rebound also pushed up employment, with 10.09 million new jobs created in urban areas from January to October, reaching the employment target set for the whole year, according to the NBS. 

Merchandise trade totaled about  2.84 trillion yuan, up 4.6 percent year-on-year in October. Exports amounted to 1.62 trillion yuan, up 7.6 percent, NBS data showed. 

"The October data showed that China is on the way to a robust post-pandemic recovery in all fronts, with both demand and supply heading for a normal, pre-COVID-19 state," Wu Chaoming, chief economist at Chasing Securities, told the Global Times on Monday. 

Chinese Premier Li Keqiang said on Friday that China's economy should achieve positive growth this year. His forecast was echoed by the economists and market watchers, who predicted that China's fourth-quarter GDP is set to expand faster, and full-year GDP growth will likely exceed 2 percent.

Fu Linghui, spokesperson of the NBS, told reporters at a briefing on Monday that China's fourth-quarter GDP growth should accelerate from the third quarter, as there are multiple conditions fueling the rapid economic rebound. 

Infographic: GT

In the first three quarters of this year, China's GDP reached 72.27 billion yuan, up 0.7 percent year-on-year based on comparable prices. On a quarterly basis, China's GDP fell 6.8 percent in the first quarter, grew 3.2 percent in the second quarter and rose 4.9 percent in the third quarter.

Wu predicted that fourth-quarter GDP will likely grow more than 6 percent.

"The second wave of coronavirus-induced shutdowns has pushed up overseas demand for Chinese goods, which will speed up the rebound of manufacturing in China. Besides, the recovery of services like dining and tourism, supported by rising household incomes, will push consumption up further in the fourth quarter," he told the Global Times. 

Liu Xuezhi, an economist at Bank of Communications, told the Global Times that construction sector will pick up speed near the end of the year, which will support a recovery of infrastructure and manufacturing output. The services sector will also become an important driver of fourth-quarter expansion.  

Lin Liwei, associate professor at Dongfang College under Zhejiang University of Finance and Economics, told the Global Times that weak overseas markets are driving international capital back to China market, which is to stimulate China's development. 

He also said that China's economy will experience a "strong rebound" next year, as the recovery of the global economy will bring new opportunities and vitality into the domestic market. 

However, Wu said it is uncertain if China's economy can fully return to a pre-COVID-19 level next year, as the economic recovery in 2020 has been more or less fueled by government's stimulus. "When the government policy effect fades, let's see if China's economic growth can power ahead as fast as previously just with the help of its internal growth momentum," he said. 

Posted in: ECONOMY

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