The Chinese economy grew at the latest speed since the beginning of the Covid-19 Pandemi in the second quarter, highlighted the economic victims who sentenced the strict “Dynamic Zero Covid” strategy.
The second largest economy in the world extends only 0.4 percent of years from year between April and June, official data shows on Friday, when locking throughout the country hinders industrial production and consumer expenditure.
A little expansion is the worst performance since the first quarter of 2020, when the Chinese economy shrank 6.9 percent after the authorities impose a lock related to the first Covid in Wuhan City.
The result, which is far below market expectations, emerged amid the increasing concerns that the world could enter the recession as a war in Ukraine, supply chain disorders, and increases in the clouds of growth in growth prospects.
Data is weaker than expected, with most analysts expecting around 1 percent,” Carlos Casanova, senior economist for Asia in UBP in Hong Kong, told Al Jazeera.
We are under consensus, as we expect a decline in the Chinese housing sector to drag aggregate demand, reducing the possibility of a sharper rebound in consumption in June.”
Casanova said she hoped that growth in 2022 would remain below 4 percent.
Although the overall performance is weak, industrial output and retail sales both rebound strong from the previous pause.
Industrial output grew 3.9 percent in June compared to the previous year, up from 0.7 percent in May, according to data released on Friday.
Retail sales rose 3.1 percent, defeating the estimated economist and registered the fastest growth in four months.
Fixed asset investment, which includes investment in property, land, machinery and equipment, grew 6.1 percent in the first half of this year, compared to a surge of 6.2 percent in January-May.
Big cities, including Shanghai’s commercial capital, are locked in March and April, as part of the “Zero Covid” policy which seeks to eliminate the virus with almost all costs.
While officials have raised the most loudest sidewalks, new restrictions that affect millions of people have been introduced in recent weeks in the provinces of Xian, Lanzhou, Haikou, Macau, and Anhui.
Apart from increasing economic and social victims, Chinese President Xi Jinping has promised to maintain the country’s without tolerance approach, emphasizing the need for “placing people and life in the front lines”.
China has set an economic growth target of around 5.5 percent for 2022, which widely believes that Beijing economists will fight.
Considering the second quarter figure, it is very possible that the Chinese government needs to reduce its annual target, because it requires more than 8 percent of growth for the second half to reach the target of 5.5 percent,” Alicia García-Herrero, Head of the Asia Pacific Pacific Economist in Natixis in Hong Kong, Tell Al Jazeera