The Chinese economy recorded a historic growth during the first quarter of 2021, supported by rapid recovery from the effect pandemic, strong demand, and continued government support for small-sized companies, official data revealed.
The data released by the National Bureau of Statistics of China showed that the Chinese economy grew by 18.3%, compared with the first quarter of 2020.
The Chinese economy grew 6.5% during the fourth quarter of 2020, which was less than analysts’ expectations of 18.7%.
Although the reading was subjected to a severe skew due to the sharp decline in economic activity a year ago, this increase is the strongest and fastest since China began publishing quarterly GDP data since 1992.
The Chinese economy growing
In turn, Liu Aihua, spokeswoman of the National Bureau of Statistics, stated that the recovery generally continued in the first quarter of the year. He said that the foundations for recovery must be strengthened, especially in light of the continuing uncertainty about the pandemic.
Zhou Hongbin, an analyst at HSBC, said the unprecedented lack of basis for comparison with last year made it difficult to interpret the economic data for the first quarter.
The Chinese economy witnessed a rapid recovery from a large decline of 6.8% in the first quarter of last year, in the worst economic performance of China in 44 years, with the outbreak of the Coronavirus, in Wuhan.
Among the most prominent factors that contributed to the recovery of the Chinese economy was the high volume of exports, following the acceleration of factories in their production to meet external demand, in addition to a regular improvement in consumption.
The gradual improvement in health conditions during the spring of last year contributed to the recovery of the GDP and its return to the pre-pandemic level at the end of 2020.
China was also able to achieve an increase in growth over the entire past year, which reached 2.3%, at a time when most of the other world economies were suffering from a recession.
Data showed that industrial production grew in March by 14.1% on an annual basis, registering a slowdown after an increase of 35.1% in January and February, and not reaching expectations of 17.2%, on an annual basis.
In March, retail sales increased 34.2% on an annual basis, up from analysts’ expectations of 28%.
Analysts had expected retail sales to grow by 33.8%, which was recorded in the first two months of this year.
The proportion of investments in fixed assets rose by 25.6% in the first three months, compared to the same period last year, surpassing expectations for an increase of 25%, but less than the increase of 35% in January and February.
Unemployment rate calculated for urban residents during March was about 5.3%, after recording 6.2% in February of 2020, its highest level ever.
The Chinese government aims to achieve a growth of 6% during the current year. At the same time, economists predict a growth of 8.6%, and the International Monetary Fund expects an increase of 8.4% in the gross domestic product of the second largest economy in the world.
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