Halting Chinese Growth Due to Pandemic Also Affects the Asian Region
The impact of the global coronavirus outbreak on the Chinese economy could result in 11 million people in East Asia being driven into poverty. The World Bank warns against this.
The pandemic is causing “an unprecedented global shock, which can stall growth and increase poverty in the region,” said Aaditya Mattoo, chief economist at the World Bank for East Asia and the Pacific.
According to a report from the bank, the growth of the Chinese economy will flatten out in the most favourable scenario this year, due to the corona crisis, to 2.3 percent compared to 6.1 percent in 2019.
As a result, the entire East Asian region will be hit hard and also sees its own economic growth falling, predicts the World Bank.
“Significant economic pain appears to be unavoidable in all countries,” the report said, advising countries to invest in healthcare capacity and take fiscal measures such as health care subsidies to mitigate the immediate effects of the pandemic.
Chinese industrial production rose in March, according to the purchasing manager index (PMI) of the National Statistical Office. The PMI rose to a value of 52 points. Above fifty points means growth. In February, the historically low cost of 35.7 was reached.
According to analysts, the new value may indicate that the Chinese economy is starting up. Despite the increase, however, an unprecedented contraction is expected this quarter, partly due to the fall in foreign demand.