China's economy emerges from COVID-19

China has effectively managed the spread of COVID-19, and is well positioned to detect and distinguish new cases that may occur in the future relative to other major economies. Through the implementation of government’s policies and measures in controlling the pandemic, China is now able to revive its economy.

China's economy began to regain its growth momentum in July and the recovery is expected to continue through the remaining months of year 2020. The economic recovery of China, knowing its size and contributions, can help revitalise the global economy. The provided statistics and figures illustrate how China is going forward in raising domestic demand and maintaining foreign trade.

Domestic consumption is in rebound as China sees a V-shaped economic recovery in the second quarter, with a year-on-year GDP growth rate of 3.2%. Retail sales rose 0.85% month-on-month to reach 3.22 trillion yuan (about US$463.99 billion) in July, maintaining a six-month streak of expansion since January. Last July, China's industrial output expanded by 4.8% on a yearly basis. In the case of taxes and fees reduction, the Chinese government will continue its tax cuts in the second half of the year, by slashing more than 2.5 trillion yuan (US$360 billion).

The foreign trade sector sets its place back in the economy, and its volume rose by 6.5% on a yearly basis to 2.93 trillion yuan (US$412.1 billion) in July. China's exports beat market expectations in July, surging by 10.4% year-on-year to 1.69 trillion yuan, while imports grew by 1.6% to 1.24 trillion yuan. ASEAN remained China's largest trading partner, with trade up 6.6% year-on-year to 2.51 trillion yuan, accounting for 14.6% of China's total foreign trade. Meanwhile, foreign direct investment (FDI) into the Chinese mainland expanded 15.8% year-on-year to 63.47 billion yuan in July, marking the fourth consecutive month for positive growth in FDI. China's investments in countries along the Belt and Road stood at US$10.27 billion in the first 7 months, up by 28.9% year-on-year.

Industrial sector on the rebound

China is positioned to be a leader in global recovery. Profits of China's major industrial firms in July totaled 589.5 billion yuan (about US$85.56 billion), increasing by 19.6% year-on-year.

China's plastics industry registered profit growth in the first five months of the year. Manufacturers of plastic products raked in 38.04 billion yuan (about US$5.39 billion) in total profits in the January-May period, up 12% year-on-year.  

End-user industries stood up through the global challenge. For the electronics sector, China has taken the lead in global 5G development. It's forecasted that China will have nearly 45% of the world's total 1.8 billion 5G subscribers by 2025. Profits of electronics industry grew 38.6% from a year earlier thanks to the rising demand for upgraded products. The use of electronics has been beneficial in the country since Chinese authorities launched a smartphone app to track users’ health status.

As for the auto industry, its profit rose by 125.5% year-on-year in July, expanding from a 16.9% increase in June as sales and investment income picked up. Most importantly, medical and healthcare is one of the essential industries that must remain strong amid the pandemic. China's medical and healthcare industry is expected to grow at an average 11% year-on-year. It has established the world's largest network of medical insurance that is accessible to everyone and has established a healthcare service system that covers both urban and rural areas.

As China recovers, the holding of major trade shows such as ChinaPlas in 2021 are expected to revive the industrial sector. From its Guangzhou venue, the next edition of ChinaPlas (www.chinaplasonline.com) will take place at the Shenzhen World Exhibition & Convention Center, on April 13-16, 2021, with more than 3,600 global exhibitors occupying a world-class exhibition area of 300,000 sqm.