China has turned the only major economy in the world to end up with a positive gross domestic product (GDP) growth last year. According to data released by the country’s National Bureau of Statistics, GDP growth in the December quarter was 6.5 per cent. This has catapulted the annual growth figure for 2020 to 2.3 per cent, despite a 6.8 per cent contraction in the quarter ending March 2020.
The 2.3 per cent GDP growth is 30 basis points—one basis point is one hundredth of a percentage point—more than the 2 per cent projection made by the World Bank’s Global Economic Prospects released earlier this month.
All major economies, country groups and sub-regions (East Asia and Pacific being the only exception, thanks to China) are expected to experience a contraction in their GDP in 2020.
In 2019, China’s GDP was $14.3 trillion in current prices, around two-thirds of the US GDP of $21.4 trillion. With China’s GDP growth exceeding that of the United States by 5.9 and 4.4 percentage points in 2020 and 2021 respectively, the US-China GDP gap is expected to come down significantly.
“However, the impressive figures did not erase the massive economic loss the deadly virus has caused to the Chinese economy, whose growth was the slowest in over four decades, and the extreme hardship it brought to small businesses that struggled or even closed permanently, as well as consumers, who have been forced to cut back on their spending,” ‘The Global Times’, a daily tabloid newspaper under the auspices of the Chinese Communist Party’s ‘People’s Daily’ newspaper, reported.