According to Prime Minister Li Keqiang, the Chinese economy must fight against “shocks that exceed all expectations”. The country’s zero-covid strategy would slow economic growth. A political package is now needed to ensure safe development.
Addressing the pandemic must be “effectively coordinated” with the country’s economic and social development, the head of government said during a meeting with provincial leaders in the Shenzhen metropolis. He indirectly pointed to the lockdowns and other restrictions imposed by China’s strict zero-covid strategy, which are severely slowing economic growth in the world’s second largest economy.
Car market exception
Key data such as industrial production, retail sales and fixed asset investment again fell short of expectations in July. China’s central bank then cut interest rates. An exception to this development is the car market, where the Asian country is once again the driving force. “China was able to increase new car sales by four percent in the first six months,” said industry expert Ferdinand Dudenhöffer of the Duisburg Center Automotive Research (CAR). An important reason is battery-electric cars.
Because German carmakers like VW, Mercedes and BMW still have problems with electric cars and software functions, they have lost their market share in China, Dudenhöffer said. Another reason is the poorer purchasing and production systems.
away from target
Overall, the Chinese economy had grown by just 0.4 percent in the second quarter of 2022, despite the government targeting 5.5 percent growth for the full year. To stabilize the economy, Prime Minister Keqiang has now called on the six strongest provinces to implement a political package and “develop their own potential”. A slow demand is an obstacle.
The International Monetary Fund (IMF) expects economic growth in China of 3.3 percent in 2022.
Source: Krone
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
