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Despite the pandemic, the Chinese economy at the top: the reasons for this fascinating rebound

2021-03-04T09:58:33.719Z


As the Covid-19 epidemic plunged part of the global economy into a record recession, the Chinese giant, the first to be affected by


The first country affected by Covid-19, China is also the first to take its head out of the water.

A year after the start of the pandemic, the Asian giant displays insolent economic health, stoking the greed of its neighbors, still mired in the health crisis.

The figures speak for themselves: Beijing has achieved an annual growth of 2.3% in 2020, according to official statistics, and even plans to reach 8% to 9% in 2021. A recovery that sharply contrasts with the recession massive impact that most countries are experiencing in 2020, including France.

But as impressive as it is, this Chinese rebound is by no means miraculous, experts say.

First of all, the crisis was not experienced the same way across the country.

Far from there.

“If growth in Hubei province where Wuhan is located, the focus of the epidemic, fell by nearly 10% in 2020, the rest of the country has suffered much less.

Because the crisis was quickly confined to this region and lasted less time, ”reminds the Parisian Antoine Bondaz, researcher at the Research Foundation, a specialist in China.

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Exports of masks, respirators ...

Thus, improved sanitary conditions enabled factories to reopen in spring 2020. Then production was able to reach its cruising level as summer approached, promoting a net recovery in gross domestic product (GDP).

Proof of the recovery of the economy, Beijing saw its exports hold up, before soaring at the end of the year.

So much so that in November, the Middle Empire had reached a trade surplus up 21% compared to November 2019, according to the Wall Street Journal.

Above all, China was able to take advantage, from the second quarter of 2020, of demand from other countries asphyxiated by the scale of the epidemic.

“The production capacity of certain states was found to be limited in the face of the crisis.

China was able to take advantage of this by exporting medical equipment (surgical masks, protective suits, respirators, etc.) ", underlines the expert, acknowledging however that" the sale of masks alone did not save the Chinese economy ”.

Market growth for new technologies

In addition to medical equipment, the Asian giant has also taken market share in the new technology sector.

Sign of the progression of teleworking in the world, exports of electronic equipment (mobile phones, computer screens, microprocessors) climbed by 36% in 2020, against 26% in 2017, according to a study by the insurance company Euler Hermes.

Graph showing the evolution of China's exports of electronic goods.

The Parisian

The increase in exports, as well as the maintenance of foreign investment, have enabled the Chinese regime to consolidate its place on the world market.

So much so that Beijing became the European Union's first trading partner for the first time in 2020, overtaking its eternal competitor, the United States.

The race with the American giant should redouble in the next few years.

According to forecasts from the International Monetary Fund (IMF), China should overtake the United States to become the world's leading economic power by 2028.

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A catch-up that was not expected "for at least a decade," says Camille Brugier, researcher at the Strategic Research Institute of the Military School (Irsem) to the Parisian.

"The Covid-19 pandemic has been a catalyst and a revealer of pre-existing trends, in particular the economic catching up of China on its American competitor, which has suffered greatly from the crisis," she slips.

The number of billionaires explodes in China

This very optimistic picture for China should not, however, hide household consumption which is still fragile and the State's dependence on public credits and debt.

Because Beijing and the local authorities have also used the budgetary lever to finance infrastructure projects, recalls the researcher.

Finally, if the Chinese market seems to have recovered from its difficulties, the redistribution of its profits is far from satisfying everyone.

Because at the same time, and as a final provocation, the country has never counted so many billionaires, despite the pandemic: 992 super-rich, working mainly in new technologies, resided on Chinese soil in 2020, that is to say 253 of more than last year.

The reflection of a society torn "by ever growing inequalities within Chinese society", underlines Camille Brugier.

“There are two distinct populations: the first is the one who has taken advantage of the economic situation and who has grown rich in exports.

On the other hand, we have a population which has certainly emerged from extreme poverty, but which cannot reach a correct level of development, ”explains the specialist.

An opportunity to "praise the superiority of the Chinese model"

Despite the increase in these social inequalities, Beijing is counting on the good health of its markets to improve its international image, but also to strengthen its partnerships with developing countries.

A work that she has already started to undertake, in particular by distributing her Sinopharm vaccine in several African countries.

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Thus, behind the economic rebound, there is an opportunity to shine "on the political and diplomatic scene", analyzes Antoine Bondaz. "It is about praising the superiority of the Chinese model over Western models." And the opportunity to shine is timely since the regime will celebrate next July, the centenary of the Communist Party, under the aegis of President Xi Jinping. "By displaying such economic health, the strength and legitimacy of the party can only be strengthened", assures the researcher.

Source: leparis

All business articles on 2021-03-04

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