Ch ina will be the only economy to record positive growth this year.This as the rest of the world continues to battle the Covid-19 pandemic that first broke out in Wuhan, China, at the end of 2019.Speaking during the annual Asian Logistics, Maritime and Aviation Conference (Almac), Carrie Lam Cheng Yuet-ngor, chief executive, Hong Kong Special Administrative Region of the People’s Republic of China, said 2020 had been a daunting year.“The global economy has been hit hard and it is projected to shrink by 4.4% this year. Merchandise trade volumes are expected to plummet by 9.2%. Fortunately, Mainland China has managed to keep Covid-19 at bay. It has seen a speedy economic recovery and will be the only major economy to see positive growth this year.”According to the International Monetary Fund (IMF), China’s gross domestic product (GDP) is predicted to expand by 1.9% this year.“We continue to project a deep recession in 2020. Global growth is projected to be -4.4%, a small upgrade from our outlook in June,” said Gita Gopinath, IMF chief economist. “This upgrade is thanks to somewhat less dire outcomes in the second quarter, as well as signs of a stronger recovery in the third quarter, offset partially by downgrades in some emerging and developing economies. In 2021, growth is projected to rebound to 5.2%, slightly below our June projection. Now, except for China where output is expected to exceed 2019 levels this year, output in both advanced economies and emerging and developing economies is projected to stay below 2019 levels well into 2021.”In its latest World Economic Outlook report, the IMF found that GDP for next year was expected to be a half percentage point higher than in 2019, but that was almost entirely due to the contribution from China.It was pulling up the global numbers, and without the Asian giant, cumulative growth for 2020 and 2021 would be negative.“China is already exceeding 2019 levels this year and continuing to grow cumulatively by 10% between this year and next,” said Gopinath.An IMF team recently visited China where it found that the strong containment efforts of the coronavirus and swift policy actions early on to mitigate the crisis had contributed to the country’s strong recovery.While the recovery is advancing, growth, however, remains unbalanced as it relies heavily on public support – while private consumption is still lagging. The IMF outlook faces downside risks, stemming from rising financial vulnerabilities and the increasingly challenging external environment. According to the IMF, China can help the international community overcome several of the major challenges facing the global economy. This includes supporting international efforts to expand access to a vaccine, providing debt relief to low-income countries and sustainable financing for global infrastructure investment, and tackling climate change.
