September 3 : The Organization for Economic Cooperation and Development (OECD) has recently come up with its outlook for the world economy in 2020. With many countries across the global being economically hit by the COVID-19 pandemic, the very outlook presented two possible scenarios ( for them) this year.
The first one is called the the “single hit” scenario, in which the nations having a single epidemic wave will suffer less economically. The other is called the “double-hit” scenario, in which the countries witnessing a resurgence of the virus shall face more negative economic impacts.
When it comes to China, in particular, the plausibility of it facing it the second the scenario has now become very tenuous. So, there is ample space to say that the economic recovery of this country from the COVID-19 pandemic will be be faster. Recent economic data also indicates at the bright prospects of such recovery. For instance, China’s GDP grew 3.2 percent year-on-year in the second quarter this year, reversing from a 6.8 percent contraction in the first quarter, according to Xinhua. In fact, the Chinese economic rebound is expected to get further consolidate in the third and fourth quarters with a 2.5-percent to 3-percent year-end growth.
Similarly, the purchasing managers’ index (PMI) for China’s manufacturing sector rose to 51.1 in July from 50.9 in June, remaining in expansion territory for the fifth month in a row, indicating stronger confidence of market entities.
Likewise, notwithstanding the downturn in international trade, the trade between China and members of the Association of South East Asian Nations has kept on growing in the recent months.
Experts attribute all these economic upsides to the prompt and prudent adoption of more stabilizing measures and policy incentives (like higher fiscal spending, tax relief and cuts in lending rates and banks’ reserve requirements). The very adoption has delivered burgeoning signs of work resumption, industrial chains and services sector. Resultantly, the
Experts attribute this to the adoption of more stabilizing measures and policy incentives. The very adoption is delivering burgeoning signs of work resumption, industrial chains and services sector, thus facilitating the China’s economy to emerge from the slump with a great agility.
As a matter of fact, experts predict and point towards a V-shaped recovery of China – that is a sharp fall followed by a quick recovery. It also means China is averting a technical recession – signified as two consecutive periods of negative growth.
With such recovery, there is also a great deal of hope that the very country may actually act as the world’s “engine of growth” in the post COVD-19 pandemic scenario, as it did in the aftermath of the 2008 financial crisis.
China’s economy did lend strong leadership for the global economic growth after 2008. By leveraging macro policies, China bought vast quantities of raw materials and goods from other countries, inserting a new impetus into the global growth.
Economists believe that the recovery of the world’s second-largest economy could well help boost the pace of other economies’ restoration. “China itself has proposed a new development pattern of dual circulation, which means that the domestic market and foreign markets can boost each other in the post COVID-19 pandemic scenario. This shows one thing clearly ; if other countries cooperate and collaborate with China, it might well become the major driver of the global economy this time too.
Source: (International news agencies)
