The GDP of the first quarter in China soars by 18.3% on an annual basis: the record leap, in the midst of the post-Covid-19 recovery, compares with the equally record collapse of -6.8% in the first quarter of 2020. But it is the data compared to the quarter of a year ago, in full Covid explosion, to give the sense of the recovery, also for the components that determined it: above all internal consumption, as well as industry and exports rose more than expected . That is, the Chinese have returned to buy, to spend while the recovery of the previous quarters was mainly linked to industrial production and the hunger for medical devices and electronic components in demand in China from all over the world, analysts explain.
In short-term terms – that is to say on the previous quarter -, growth is 0.6%, according to the data provided by the National Statistics Office, less than the 1.5% estimated on the eve. And also the + 18.3% is lower than the expectations of the analysts who indicated between + 18.5% and + 19%. For the whole of 2021, China – which had closed 2020 up by 2.3% – expects GDP growth of 6%.
“A good start”
“The national economy has got off to a good start,” said National Statistics Bureau spokesman Liu Aihua, admitting that the spike in growth was partly due to “incomparable factors, such as last year’s low base figure. and the increase in “working days due to people staying during the Lunar New Year holidays”. Migrant workers were urged to stay in work areas during the break for fear that the massive migration could lead to local epidemics. Liu added that quarterly growth has “demonstrated a steady recovery”.
“We are seeing a somewhat more balanced recovery in the Chinese economy,” Wang Tao, China’s chief economist at UBS, said in an interview with Bloomberg TV. «As monetary and fiscal policy begins to normalize, real estate and infrastructure investments are expected to slow down in the coming quarters. This early recovery in the construction sector will give way to greater household consumption ”.
Export boom, + 49%
In March, industrial production increased 14.1% yoy, bringing first quarter growth to 24.5%, while retail sales rose 34.2%, for a total in the first three months to + 33.9%. However, Liu called for caution, especially since the international scene still reserves “high uncertainties”. The unemployment rate, relating to the urban component, fell to 5.3% from 5.5% in February. Also worth noting is the greater demand from trading partners who resumed after the pandemic that fueled Chinese industrial production and investments: exports increased by 49% in the quarter to 710 billion dollars and imports by 28. %, to $ 593.6 billion.
The reactions of the Stock Exchange
Closing in sharp rise for the Asian stock exchanges that look with confidence to the recovery in China, confirmed by the boom in GDP in the first quarter, which grew by 18.3% on an annual basis. In Hong Kong, the Hang Seng index rose by 0.74% to 29,005.53 while the Nikkei index in Tokyo gained 0.14% and the Topix by 0.09%. The Shanghai Composite Index gained ground with + 0.81% while in Seoul the Kospi closed with a rise of 0.13%.