Beijing: China, the so-called father of the world's biggest corona epidemic, is now repeatedly imposing lockdown in its cities to protect itself from it. He is also facing serious consequences for this lockdown. During the month of August, there has been an increase in consumer spending and industrial production in China. Despite this, his financial condition still remains bad. Economic analysts cautioned that the situation in the world's second-largest economy remains critical due to repeated 'lockdowns' being imposed to prevent the corona epidemic.
Despite the increase in industrial production, there is weakness
According to data from China's National Bureau of Statistics, retail sales grew 5.4 percent year-on-year in August. This is more than double the growth of 2.7 percent in the previous month. In the official estimate, it was expected to be 3.3 percent. Industrial production grew by 4.2 percent in August, from 3.8 percent in July. It is a matter of fact that industrial production has increased in China, but it is still weaker than the previous performance.
house sales down
According to the National Bureau of Statistics, investment in factories, real estate and other fixed assets stood at 5.8 per cent, up from 5.7 per cent in July the previous month. According to official data, sales have come down with reduction in house prices. This has slowed down the activities in the real estate sector. One reason for this is the measures taken by the government to control the increase in corporate debt.
Economic growth still slow
Capital Economist's Julian Evans-Prittcard said in a report that China's economy has done slightly better than expected. However, the pace of growth is still slow. China's economic growth slowed to 2.5 percent in the first half of 2022, less than half of the official target of 5.5 percent. In the absence of large-scale incentive expenditure, the cost of debt and housing may increase.
China's economic growth will remain below three percent in 2022
Economists said that China's economic growth rate may remain below three percent this year. This is less than half as compared to 8.1 percent last year. The government has now stopped talking about the target of 5.5 percent. China's economy has been affected by the repeated restrictions imposed to prevent the coronavirus epidemic.
Economic activity has been affected by restrictions in Shanghai and other industrial centers in March. These restrictions have eased, but some restrictions have been temporarily imposed in the southern business center of Shenzhen and other cities. ING's Robert Cornell said in the report that the risk of 'lockdown' still remains in front of the economy.