China economy grows 4.9% in 3Q, extending virus recovery

BEIJING • China’s economy grew 4.9% year-on-year (YoY) in the third quarter (3Q), sustaining its rebound from bruising virus lockdowns and moving closer to pre-pandemic levels, official data showed yesterday.

But the world’s second-largest economy grew slightly below expectations in the July-September period, National Bureau of Statistics (NBS) data showed, which warned of uncertainty ahead as “the international environment is still complicated”.

China’s recovery has so far put it on track to be the only major economy expanding this year, according to International Monetary Fund forecasts, while nations around the world continue to struggle with lockdowns and new waves of infections.

Analysts polled by AFP earlier pegged 3Q growth in China, where the Covid-19 first surfaced, at 5.2% from a year ago, up from the 2Q’s 3.2% rise.

NBS data also showed retail sales grew faster than expected in September at 3.3%, up from 0.5% growth YoY the month before.

But this still lagged behind industrial output growth, which came in stronger than expected at 6.9% from a year ago last month.

China’s Communist leadership has hailed its handling of the virus, giving experimental vaccines to hundreds of thousands of its citizens as it seeks to reframe the pan- demic’s origin story.

People in China are back out shopping, travelling and eating — in stark contrast to many other parts of the world.

But long-term fears over jobs and a potential virus rebound in China are weighing on consumer sentiment, despite government attempts to reignite domestic demand.

“China built its quick recovery via stringent lockdowns, massive testing, population tracking and fiscal stimulus,” Nomura Holdings Inc chief China economist Lu Ting told AFP.

Other factors such as export growth and a surge in demand after massive floods in the summer also boosted activity in September, he added.

But “China is not absolutely free from the risk of a second wave of Covid-19, pent-up demand will likely lose some steam…and rising US-China tensions could dent China’s exports and manufacturing investment”.

NBS spokeswoman Liu Aihua said yesterday that although China’s economy has continued its steady recovery, the global picture is murky “with considerable instabilities and uncertainties”.

She highlighted “great pressure” in forestalling virus cases from abroad and preventing a virus resurgence at home.

Meanwhile, the urban unemployment rate dipped further to 5.4% in September, although fixed-asset investment growth turned positive for the first time in 2020. — AFP