Chinese Economy Shrinks For the First Time

The Chinese economy shrank during the initial quarter of 2020 in a historic first since the country started releasing records in 1992.

The National Bureau of Statistics of China said that the country’s GDP decreased by 6.8 percent in the first three months of 2020, following the global coronavirus pandemic which originated in Wuhan (Hubei province) in December and stopped much of China’s economic activity in its tracks in Q1.

GDP growth in China had been slowing before the crisis, but had seemingly stabilized around 6 percent of quarterly annualized growth during 2019.

The country’s negative GDP readings is likely only the first in a line of many, as more dismal results are expected in Europe and the Americas, where shutdowns started in March. In these regions, country’s are expecting weakened GDP growth in Q1 because of China’s impact, but the worst is likely to come in Q2 of 2020, when the full force of the lockdown measures will become apparent.

In the case of China, Hubei province and the rest of the country have been leaving lockdown, so some easing could be on the way for Q2 GDP figures.

 

Source: Statista

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