Latest data shows Chinese economy is recovering
Chen Jiahe


Editor's note: Chen Jiahe is the chief investment officer at Novem Arcae Technologies. The article reflects the author's opinions, and not necessarily the views of CGTN.

On October 18, China's National Bureau of Statistics announced the country's latest economic data in the third quarter of this year. The latest financial data has shown the market that the Chinese economy is gradually recovering in the post-COVID period and is taking up an important role in the global economic recovery.

Overall speaking, the total GDP of China in the first three quarters of 2021 increased by 9.8 percent compared with one year ago, after the deduction of the impact of inflation. This high growth rate is partly the consequence of a low base in 2020, as the COVID-19 hit the Chinese economy with a surprise at that time and the anti-pandemic measures cost the economy heavily.

Taking the third quarter of 2021 alone, China's total GDP increased by 4.9 percent compared with one year ago. As the third quarter of 2020 was a stable period for the Chinese economy, and the impact of the pandemic was not as strong as the previous two quarters, the growth rate expressed in the third quarter of 2021 compared with 2020 can be viewed as a more reliable indicator for the economic growth rate of China in this post-COVID era.

Within the different sectors of the economy, the consumption sector has strongly supported economic growth. In the first three quarters, the total social retail value reached 31.8 trillion yuan or 16.4 percent more than one year ago. In this September alone, the total amount of social consumption increased by 4.4 percent compared with the same month in 2020 and is 1.9 percent faster than the data reported this August.

One of the most important contributors to the consumption sector of the Chinese economy is internet shopping. For the first three quarters of 2021, China's total amount of internet shopping reached 9.2 trillion yuan($1.43 trillion), 18.5 percent more than one year ago. This large consumption sector takes up almost one-third of China's total retail consumption, which shows us that internet shopping is clearly one of the most important parts of China's consumption market.

In this new internet era, many businesses are now eager to conquer their territories on the internet, rather than those traditional brick-and-mortar shopping malls. For example, in the past two years, partly stimulated by the social quarantine measures taken in the COVID-19 situation, internet shopping for fresh food grew rapidly in China. Today, the lacking of appearance in traditional shopping malls can mean little harm to businesses, but the lacking of a considerable appearance on the internet can hurt a business strongly.

China's GDP growth. /CGTN

China's GDP growth. /CGTN

In the agriculture sector, the increasing production of pork has contributed significantly to the reduction of consumption inflation. At the end of the third quarter of 2021, China has a total amount of 438 million swine, 18.2 percent more than a year ago. This has caused a rapid drop of the pork price in China. As the pork price takes a large part in China's consumer price index (CPI), the consumption inflation of the Chinese economy has been contained. In the first three quarters, the total CPI has increased by merely 0.6 percent. Although the PPI has increased by 6.7 percent in the same period, its impact has not yet been felt by the consumption sector.

As the world's second-largest economy, the Chinese economy has become a strong support to the global economy in this worldwide pandemic. The data of the international trade of China has shown us that this support has been significant. In the first three quarters of 2021, China's total amount of international trade was 28.3 trillion yuan ($4.4 trillion), 22.7 percent more than a year ago. In this September alone, the total amount of international trade was 3.5 trillion yuan ($540 billion), or 15.4 percent more than a year ago.

As the economy has been running stably, the employment situation in China is making the market feel comfortable. In this September, the urban unemployment rate was 4.9 percent, 0.2 percent lower than the data reported in August and 0.5 percent lower than the same month last year. A stable employment market does not only bring stability to China's society, it also brings enough consumption capability to the economy.

The support that a stable employment market can bring to the economy, especially the consumption part of the economy, can also be observed by looking at the citizens' income growth. Data shows that in the first three quarters of 2021, China's average dispensable income was 26,265 yuan ($4,084), 10.4 percent higher than one year ago. This rapid growth of income has become one of the strongest cornerstones of the Chinese economy.

Overall, the latest economic data shows us that the Chinese economy is growing stably in the post-COVID-19 period. As long as the COVID-19 situation is well contained in China, this economic growth trend will continue in the coming months.


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