The Chinese economy grew at a faster pace than before the coronavirus pandemic in the fourth quarter of 2020, official data showed as industrial production continued the country’s recovery.
Domestic product growth beat expectations of 6.5 percent in the last quarter of last year.
The new data underscores a rapid turnaround in the world’s second largest economy, which declined for the first time in more than four decades in early 2020 after the country was hit by the pandemic and the authorities imposed a harsh closure. In the fourth quarter of 2019, China grew by 6 percent.
The subsequent recovery was driven by higher industrial production, which benefited from state support and added 7.1 percent in the fourth quarter, compared to 5.8 percent in the previous quarter. Retail sales, a measure of consumer lust, are lagging behind in the industrial sector, adding 4.6 percent in the fourth quarter.
Ning Jizhe, head of the National Bureau of Statistics, said the economy was “gradually recovering” last year, but added that the “changing epidemic dynamics and the external environment hold a multitude of uncertainties”.
The GDP figures, which beat expectations, came days after China recorded its highest monthly trade surplus ever in December, fueled by three consecutive months of double-digit export growth. Exports rose 18 percent last month compared to the same period last year.
The data contributes to a range of other metrics that reflect a booming Chinese economy. This month, for the first time since 2018, the renminbi exceeded 6.5 against the US dollar, while the Chinese stock market reached its highest level since the global financial crisis.
The country’s return to growth last year drew strong appetite from foreign investors, who in 2020 drew about Rmb1tn ($ 154 billion) to Chinese equities and bonds through Hong Kong investment programs.
In China, new cases of Covid-19 declined in mid-2020, but a recent outbreak in the northern province of Hebei has caused a renewed wave of social restrictions and closures. Last week, the country reported its first coronavirus death since April.
Unemployment was 5.2 percent in December, unchanged from a month earlier. Real estate increased by 2.9 percent during the full year, while real estate increased by 7 percent.
Additional reporting by Xinning Liu in Beijing
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