Chinese GDP in the first quarter jumped to a record 18.3% compared to the previous year. At the end of 2020, growth was 6.5%. The boom is also explained by the comparison with the first quarter of last year, when China was in full pandemic and the country’s activity reduced to paralysis. But the substance is that Beijing has put the economy back on the right track supported by the recovery of internal but also external demand and by the state support for the restart of small and medium-sized enterprises.
The resumption of activity
By early 2020, the economy had contracted by 6.8%, the worst performance in Chinese history since the mid-1960s. In the following quarter it had regained 3.2%.
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Domestic consumption has now started to march again in the first part of 2021. Restaurants and shopping malls (+ 75.8%) reopened after the Chinese New Year and generally all the business open to the public has resumed normal operation.
Last year, the GDP on an annual basis was, in the final balance, 2.3 per cent. This year it is expected to exceed 6%, while the Monetary Fund forecasts are even more optimistic, over 8%. Production data grew by 24.5%, investments in real estate grew by 25.6%.
The effect on the financial markets
The GDP data from the National Statistics Office had a direct impact on the markets, also considering the corporate profits recorded in 2020, those of the first quarter of 2021 could be growing further. Stock exchanges reacted well, even in Hong Kong the Hang Seng index remained positive.