Chinese economic indicators get a major setback as the coronavirus outbreak has badly hit the country. The pandemic has adversely affected the country’s economy, negatively impacting business organisations and consumers.
China is among the developed nations with a high-rise global economy rate. However, in the last three months, the country’s economy has seen a drastic fall as the economic indicators show its low GDP rate. Geo-Politik reports that in the last three months, the GDP growth rate of China has decreased by 2.6%. The low growth of the GDP is a significant indicator of the current economic upheaval in the country.
During the endemic outbreak, major Chinese cities that were the most significant economic and manufacturing hubs were partially or completely under lockdown. These manufacturing hubs offered job opportunities to approximately 127 million people.
The lengthy lockdown in Shanghai and other major economic Chinese hubs was a cause of the shockwaves to its economy shrink. According to a report published in Washington, in April, not a single automobile was sold in Shanghai. During the end of the June quarter, Shanghai’s economy shrank by 13.7%.
The lockdowns in China were reported to have led to an economic outburst. It resulted in food shortages and arbitrary quarantines, per the Geo-Politik reports.
The economic slowdown process in China was practically visible in the lower consumer demand and buying potentiality. Even after the authorities’ repeated attempts to stimulate the economy, there was a drastic economic setback in the Chinese economy.
Geo-Politik reports, “Consumers cut back spending while buying costly automobile items or inexpensive products available online.”
Interestingly, the Chinese Central Bank cut lending rates in August to revive the economy. There is a record higher rate of youth unemployment in China. Even the housing sector has been experiencing a major setback with a shortfall of the other sectors to maintain the supply chains.
According to leading economic experts, the economic downfall in China is deep and needs several years of stabilizing and structural planning to revive its economic situation.
