Hit by Covid-19 bumps, what new turns will China take in its road to economic recovery?
Just as the third year of the Covid-19 pandemic was drawing to a close, China’s policy pendulum finally swung from stamping out and controlling spread of the virus towards spurring economic growth, leaving everyone pondering: how will the world’s second-largest economy perform in 2023?
China in late November began abandoning most pandemic restrictions, ending the hyper-strict “zero-Covid” strategy that had taken an increasingly heavy toll on its economy and its people.
Excluding the first year of the pandemic, GDP in 2022 is estimated to have grown at the slowest pace since the 1970s according to economists surveyed by Bloomberg, with a soaring number of people failing to find a job. The youth jobless rate reached a stunning 19.9% in July, the highest level since record-keeping began in January 2018.
In the few short weeks since ditching the tough Covid measures, policymakers have sent clear signals that the country would be emerging from its pandemic footing and the priority is now once again fueling economic growth.
At the mid-December Central Economic Work Conference (CEWC), a key annual event to map out the economic policy agenda for the coming year, top leaders vowed to put stable growth above everything else.
The pivot comes with real urgency as China’s economy expanded just 3% in the first three quarters of last year, compared with 9.8% during the same period in 2021. The slowing growth reflected the disruptions to business caused by stringent Covid control measures as well as global uncertainties stemming from the war between Ukraine and Russia.
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