China’s gross domestic product expanded 6.5% in the fourth quarter of 2020, beating forecasts and making the country one of the few in the world to register positive growth for the year.
Year-on-year GDP growth for the final quarter beat expectations, according to official data released on Monday, with the Chinese economy expanding 2.3% over the course of the full year as industrial production continued to drive the country’s recovery.
The new data underlined a rapid turnround in the world’s second-largest economy, which declined in early 2020 for the first time in more than four decades after authorities imposed an extensive lockdown to stem the pandemic’s initial outbreak. In the fourth quarter, year-on-year growth was the highest of any quarter since 2018, and China will be the only one of the world’s biggest economies that did not shrink last year. But its positive full-year GDP growth, while ahead of global peers, was still China’s weakest in more than 40 years because of the contraction at the start of the year.
China’s benchmark CSI 300 index of Shanghai- and Shenzhen-listed stocks rose 1.1 per cent following the data release, while equities markets in the rest of the Asia-Pacific region dropped. Ning Jizhe, head of the National Bureau of Statistics, said the economy “recovered steadily” last year but cautioned that the “changing epidemic dynamics and external environment pose a multitude of uncertainties”, and that the “foundation for economic recovery is yet to be consolidated”.
China’s rebound from Covid-19 has been powered by higher industrial production, which benefited from state support and added 7.1% in the fourth quarter, compared with 5.8 per cent in the previous quarter. Retail sales, a measure of consumer appetite, have lagged behind the industrial sector, adding 4.6% in the fourth quarter.
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