Topic: China’s economy is contracting and this is not good for the global economy. (Read 565 times)

   
Thing may change in coming time as people would like to not depend upon one country much as we have seen what this has resulted in this turnmoil times. Also things will look much different then what it was before and in coming time the world would change for better reasons only I feel. No doubt we are in recession and things may take time to recover now and things will move out from China slowly too.

The trade war is proof that China is a great economic power challenging America, the superpower. Many bilateral trade deficits against China. This proves that China is a major economic power in the World. Besides that, as a matter of fact, China indeed dominates world trade and funding. One Belt One Road is colonialism 5.0 which is carried by China throughout the World.

The middle-income trap not only benefits developed countries but also developing countries. China would be happier if China and the partner country OBOR in the middle-income trap. Even China is keeping China and its partner countries as developing countries rather than developed countries. Because this is more profitable. With the title as a developing country, many importing countries will provide preferential tariffs so that the prices of their products are competitive in many developed countries.

Besides that China and many OBOR partner countries China already bears the title of developed countries not developing countries anymore because, at the end of February 2020, the US Trade Representative Office (USTR) crossed China and 23 other countries from the list of developing countries that automatically now hold the status of developed countries.

There is indeed a capital flight from China, even now the United States is building India like America is building China to contemplate the power of China in Asia, but the shift in the world's manufacturing centers will not really hit China, with reason. With BRI, the China project is not only domestically but in many countries which are OBOR's Chinese partners. Brillian's China strategy keeps Renmimbi spinning in China so China can print as much money as possible but the dollar enters China.

I don't think China has any influence on the global economy. As we all know, China has not yet escaped the middle-income trap. The Chinese economy has been growing rapidly in the past 10 years because many multinational companies have set up factories in China to take advantage of cheap labor. But when the trade war between the US and China took place, companies tried to move factories out of China to other countries like Vietnam, India and Mexico. As a result, China's economy will be in a deep recession and they have to create jobs for their 1.4 billion people.

The contraction in their economy is not a wonder since they are most affected in the early days from corona virus but I am seeing lot of leaders starts to blame China for exporting low quality products even in the pandemic because they are looking to make more money by using this period so many companies and countries wanted to move from China to save themselves from huge fall.

I doubt that many countries see chinese products as corona carriers since the risk of the virus remaining active after international transport are pretty much nil:



Unless you share a border with China, Chinese products will usually travel for weeks under very unforgiving conditions until they reach their destination. Remember we're talking about what is essentially a simple piece of RNA wrapped in fat, not some extremophile survivalist bacterium.

What I do believe is that the trust in Chinese health-care export has decreased a lot after several governments purchasing face masks of questionable quality [1][2][3].

[1] https://www.ft.com/content/f3435779-a706-45c7-a7e2-43efbdd7777b
[2] https://www.abc.net.au/news/2020-04-04/china-coronavirus-covid-19-medical-supplies-recalled-regulation/12105110
[3] https://orf.at/stories/3160881/ (German only, sorry)

many countries worry chinese product could be the corona carrier to their countries.. and some of them prefer to closed import from china till condition recovered again. but its not only the reason why chinese product decrease alot in international trade, another countries also suffered big negative impact fro covid 19 virus. maybe they will reallocate budget allocation in this pandemic and save the citizens.

Demand for Chinese products has decreased and the reasons for this are clear to everyone. And now China is busy supplying medical equipment and medicines to fight coronavirus to many countries around the world, while these countries are sitting in quarantine. And when we compare the volume of China's exports, we forget that other countries will have even lower figures and, consequently, losses will be greater than China's. Because everything is known in comparison.

I never thought of actually coming up with this news. We have known China's independence when it comes to their economics status and they never failed to show us its strength. We even saw a light scratch only on their economy durint the virus. So now, hearing a 6.5% decline is shocking. It can affect other countries as well causing economic depression but hopefully, not only China but all other affected countries will heal itself and build itself again.

China will never fall under a financial recession They keep their information confidential to everyone within the world As China may be a developed country within the world more deals are through with China within the commercial field. But you've got rightly said that the Chinese economy is contracting and it's not good for the worldwide economy because the economies of every country are so constrained how they're going to be ready to trade if they're spending many days in crisis.

It was a shocking event, where developed countries and developing countries experienced a very critical monetary impact due to the spread of the virus, China is one of the strongest countries in international trade but in reality, they enjoyed a drastic monetary decline, and this situation will close a long time because international countries supporting their trade experience the same thing where they experience a really serious financial slowdown. I don't think I will bet too early on what will appear next.

I'm not surprised anymore that China's economy is also in the rock as most of the countries are also experiencing this. But i believed China will still have its own time to back up its falling economy and they don't care whether it will be fair or unfair to some of their trading countries. China is great but this time, i think they are secretly fighting selfishly.

if chinese manufacturing were really running at full capacity, it would only intensify the deflationary effects on the economy by increasing an already saturated supply of consumer goods. continuing to produce above and beyond real demand would only push prices even lower. that would be an economic disaster for china.

the oil market is a microcosm for this effect. there is a drastic oversupply of oil on the market---so much that nobody wants to store it. so the price is crashing (deflation) and producers are now going deep in the red. this will lead to bankruptcies, market uncertainty, bailouts, and all that good stuff.

that's the trajectory the chinese manufacturing sector is on too if american and european consumer demand doesn't strongly reverse, or production isn't scaled down in preparation for a depression.

Lol, you realize that if the other countries are suffering, the factories in China running at 101% makes ZERO sense?
Yeah, they've recovered, they are going back to work..to whom will they sell all they produce?

Of course, China lies with all the numbers they publish so to get the full picture you would have to look at the countries that are also exporters to Europe and US. And from there are only sad stories, like the garment industry in Bangladesh who is seeing 3 billion or Vietnam with 1 billion in canceled orders and that's just the tip of the iceberg, you can't produce things if you don't have somebody to sell to.

Forget the government's numbers, this is the reality in China

Without the EU and the US which represent half of the world economy in GDP terms and imports, producing things that nobody can buy is a waste of money.

I am not really that worried about China, they have been the hardest hit so far because it was the country were the corona virus first appeared, the ones I am worried about are the economies on Europe and the US, they are being hit by this virus in an even harder way and they were in a bad shape to begin with and now they are printing huge amounts of money, if this keeps for long then this is going to be one of the worst crisis that we had to face and the worst part is that no country will be safe, on the other hand this could be an opportunity for bitcoin to shine but at the same time it will be an incredible test for those that are holding a significant amount of bitcoin since the volatility will be extreme in such scenario.

China's population is 1.4 billion and its sufferers are only 80+ thousand!! my question "Are you sure CHINA is honest with the number of their COVID-19 sufferers??

days after the end of this "PANDEMIC" it will be hard for many countries to revive their country's economy, as you say "PREPARE YOURSELF FOR ALL POSSIBILITIES THAT WILL HAPPEN IN THE FUTURE"..

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China was the first country of the COVID-19 virus and then they bought a lot of masks and PPE from all over the world, then the whole world was affected by COVID-19 and then the world lacked masks and PPE, what a nice scenario to mess the world  

Advantage when you are the first one to recovered and while the world economy are suffering China is on the process of bouncing back, they are moving and slowly putting things accordingly, there's no real vaccine that's been proven to cure this pandemic virus but China's Wuhan province already open after that massive infections that circulates around the place, this province is already open meaning to say that economy now is ready to be rebuild.

This Should not be strange, you know what they have gone through and you know how much damage could have happened in the few moment of the lockdown and disaster. I'm sure they would recover, because China is smart about that. They actually had much loss. If China could be so affected with their level of technological advancement, how much more many underdeveloped countries.

They should not be doing anything at this point. All they should do is, give some air to breath to rest of the world. China being biggest and cheapest market for the manufacturing industry, i believe its time to flip the cards now. Most of the country are now on the verge to put up their own industralisation as big as China owns today.

Dependancy on chinese market has led us to no where and its also very fearful if china is bioengineering viruses like corona in todays date. I know, I know no proof for that last claim but its china, they can do anything to "arrest" their own economy. May be thats your answer.

Have you not wondering why China easily handled the virus? I mean the suspicion is quite strong with a pretty basic logic of thinking and we already have many of threads talking about theories with the pandemic. We've known China for a long time, their economic progress is really noticeable as the world goes on that even USA is a bit shaken with the China's industrialization taking a hard bang on the spot. It's good to know that China recovering, I hope they'll find the cure for the pandemic as quickly as possible.

^ Definitely country of China is the ground zero of COVID-19 that their economy was affected as well. Though their economy has dropped down a bit they were able to surpass the pandemic while other countries are still in crisis. Since China was able to overcome then they are the first ones who can bounce back on their economy. While other countries are still suffering from this crisis they are already of help, in fact, many supplies that are necessary from this pandemic are coming from China. Nevertheless, I dunno, if they are mind, is in the business despite the calamity happened. AFAIK.

Of course, you have not an iota of evidence to support your suspicion. After all, that is a suspicion that is far-fetched as it is absurd. It defies logic. You said that the Chinese are business-minded people. If that is so, and supposing they have the vaccine or the cure, they should not just be selling masks this time. That cure should sell much more easily and more expensive than those cheap masks and gloves. Also, selfishly keeping the cure within them is still a suicide to their economy. Their market is the world. And, most of all, China is still recording new infections until now. Whether they are imported or locally transmitted is not the point; the point is that for as long as the virus is present in other countries, they, too, are vulnerable.

I believe that you needlessly worry about the Chinese economy) The country has almost won the coronavirus pandemic. And its industry will soon be operating at full capacity. And given that other countries still have a long way to go before the end of the pandemic, China will now become the main supplier of industrial goods to all countries of the world.

The reason for the shrink in China economy is due to the shrink in its international or export trade. You know China is a manufacturing economy and many countries rely on China for one raw material or other.

So, China loosing these business due to covid-19 containment measures which closes exportation and importation is the cause of the decline of China economy.

The situation of global economy is not getting better with this happenings of corona. I hope that America recovers fast too as China has done so that we can start having some economic growth and the crypto turning to green again. The economy is going through crash and the business of cryptocurrency is crashing too.

We are living in an unprecedented time. As China was the first to suffer from the virus pandemic, it is logical to think that it is the first economy that it should recover. In addition to being an industrial power, work in big business has not yet returned to normality.

We all know that Chinese people are business-minded and they value money above all, because of that mindset, China really have a well-growth economy. This virus doesn't affect their economy that much because they are the no.1 supplier of products around the world and they are a large manpower because of they have the largest population around the world. The virus killed a lot of people from all around the world and it is really uncontrollable as its cases are still increasing, yet, the cases in China become stable and slowly increasing, I think that they already have the vaccine or cure but they don't tell other country because we want US to suffer more from this pandemic, We don't know, we have no evidence about that but it is so suspicious.

Good point. Honestly I wonder how well the service sector worldwide is going to recover from this. I'm afraid we'll see a lot of consolidation once this whole mess is over, with big companies strengthening their grip on the market as small business owners run out of reserves.



Definitely. While we're luckily not in an end-of-the-world scenario the unavoidable long-term impact doesn't seem to be priced in yet. Especially since a market bust has been long overdue for now, even without a pandemic going on.

We all know that China is really good at manipulating and maintaining the state of their economy, they are the most manufacturer of goods around the world and we can't deny that most of our products came from them. We can't deny that some of the countries rely on the economy of China that's why there are people who believe that China will dominate the economy after this Covid-19. I don't really know if this is a strategy of China because American and European country are suffering from the virus that originated from Wuhan, China and the economy of these two are really crashing. Like what I've said, this is the reality that China is a huge country and stable enough in terms of their economy.

See this is what people need to hear , unfortunately because of the virus being originated in China , it has created a lot of offense for the Chinese government , people are saying they are being benefitted or they have the vaccine and they are not giving it away , unfortunately economy of every single country is being infected.
With the Corona virus killing so much people and creating it harder for anything to work out , economy of even China is being affected and we all know how much China exports , everything that is Cheap or costly one way or the other , even the spare parts they come from the Chinese markets , so if they get into a bad situation then China will have to increase prices and inflation will cause other countries to be affected too .

I am sure not just China that will be recover, but the other country who gets the effect of coronavirus will try to recover, especially if the country has to get lockdown. They will try to solve some main problem first in their country, and after that, they will try to solve the problem with the outside of their country and will try to make sure it can work properly as before. Maybe that would need months to see it will fully recover, and maybe there will be a changed regarding the current situations because the recovery process will not bring them to the old conditions.

I think the Chinese economy contracted to below zero in Q1 is reasonable because since the end of December when the plague boomed until the lockdown opened at the end of March, the euphoria of the preparation of the Chinese New Year holiday which in fact failed due to covid-19 and the extension of the Chinese New Year has made the economy slow down and even die. Not only in China but throughout the world. The main cause comes when the coronavirus outbreak cripples production and spending and increases pressure on governments to do more to stop the increase in job losses.

It is difficult to realize the growth of the after pandemic effect, realistic economic growth targets must be made so that the government does not spend a lot of money on infrastructure investment policies, reduce unemployment or improve people's livelihoods in the short term, which in fact brings disaster to the economy.

It is not only China that will face the after pandemic challenge. China was lucky because it entered the pitstop first. Like a factory engine that is turned off when it will turn it on again requires effort and acceleration. After the pandemic effect ends in China, it is impossible for China's economy and manufacturing to run 100% immediately. The case of corona from outside (imported case) also made China afraid of the second wave of corona and made consumption and domestic demand far from normal.

I was able to contact some of my seafood buyers there and ask how was the condition there? They explained that there was indeed a lockdown in Hubei but in other cities, everything went as usual. Demand for crabs and lobsters that were previously stopped because Corona has begun to reopen and prices have begun to rise.

As long as the project is still running, China will be fine. Too big too fail for China with all its strategies and big ambitions not only for prestige in the global world but survival for the Chinese people whose numbers are jumbo. It is possible that the news of this contraction in the blow-up to improve the image of China in the international world that after bleeding China came out as a winner. The issue of contraction is used to create the dramatic effect of China's victory in drama from victim to global hero.

This is a matter of condemnation for the Chinese government. After this great pandemic with many doubts about the spread of viruses in China, many foreign investors withdrew capital from Chinese enterprises and invested in other countries. It seems that the Chinese government is aware of this and is trying to hide true data about people infected and coronary deaths. They are doing everything to make the data look nicer and entice foreign investors to keep their capital. A few hours ago I received a news in China about the government forced many factories to operate again without orders. And soon, people burned down many factories. I cannot cite the link because it is a foreign newspaper, but my words are true and China's economy will face many difficulties if it continues the persecution.

Let's not even mention the duration. Just a single month of shops closing down could bring about massive changes to the Chinese economy. There's also the expenses that the government has spent towards helping those involved in the quarantine/lockdown to survive. There's also another issue, China was pretty much the cause of the massive damages literally every country in the world has experienced. Just look at how much damage it has caused to US, Italy, etc. And China has no excuse here. China has suffered damages yes, but other countries have suffered more compared to China, and it isn't even their fault. Especially now with how countries are seeing the lifting of lockdowns in China. There'd probably be no change sin the next few weeks cause the other countries are trying to contain the damages, but after that, they'd probably want an answer from China.

Chinese economy is able to recover, but it will take some time. The world has never faced something like that pandemic before, so the economy repairing roadmap isn't clear yet.

The western economies(and all the other economies in the world) are going down.China exports goods to the rest of the world.If the global economy goes down,the Chinese export will go down,hence China's economy will lower it's growth.We still don't know about the second wave of coronavirus happening in China.Is there a second wave and how big it is?Will it cause another lockdown?
The Chinese authorities lied about the covid-19 damages,let's hope they won't lie again.

They will be the first to recover. I don't know if the news that I've heard and once read is true that most of the stocks on the EU and US have been bought by them during the dip. I can't support that claim because I'm not into those stocks.

Also, there's this issue that I've heard too that some of the foreign businesses that are operating in China probably in the manufacturing sector are pulling out their businesses there. And this might be one of the reasons behind that contraction.

How on earth could the Chinese economy remain strong despite this virus? You have to remember that this virus originated from China itself. It is where the first epicenter was. China was the first country where the virus killed a lot of people, caused lockdowns, closed shops, cancelled shipments of goods, and so on and so forth. If all these things wouldn't cripple China's economy, they must be gods. There is nothing stunning in the fact that China's economy is contracting in the face of this crisis.

The economy of China should remain strong otherwise this will affect the world economy because of the heavy dependent of the nations of the world for production. We should learn to decentralize production in China, should this kind of Pandemic happens again, the world will be on her kneels if production remains centralized.

I think 80% of the world are facing the economics crisis,but in China I don't think so if they face hard for thier econics..despite the corona virus attacked thier country still they are afford to send the donation for many country's..so I think thier economics are not down tooucb unlike other country

China's Q1 numbers are heavily due to the shutdowns themselves. The service sector was actually the hardest hit. https://www.reuters.com/article/us-china-economy-business/virus-had-eye-popping-impact-on-chinas-economy-beige-book-idUSKBN21A3R9

I expect the situation to continue deteriorating into Q2 due to the lack of export demand you mention.

Lots of people around here still seem to believe the Chinese government narrative about a miraculous V-shaped recovery in Q2. I'm very skeptical. In fact, I would say markets across the world are way too overconfident in a swift economic recovery. That goes for the US and Europe too.

The whole world is in shambles right now, and China is no exception. Also, most of the giant companies of EU and the US are already thinking of leaving their production and manufacturing bases in China for good, plus the fact that the whole world is looking down on China for selling defective gears against COVID-19. If this goes on for a couple of months, we might see the whole world take a hit as a recession follows. And for damn sure China isn't one to suffer from it but also the whole world. After the pandemic eases, the world would be rushing back at its feet to catch-up and repair the economy, which would not be pretty and easy.

Yeah no shit. Countries are pissed, UK, ITALY, USA have more cases of coronavirus all because of China. People are in lockdown everywhere except China. So if countries cant get rid of Coronavirus, they are gonna do the next best thing, doom China.

China's economy contracting is a bad thing for sure, because once we get out of this shitshow, things are going to be WAY WORSE, not only health wise, but for the economy as well. I would be lying if I said I am not scared about what 2021 is going to look like, because getting over from a pandemic could be either of the two things: The global economy ends up in a full fledged recession where we end in a doom and almost not be able to recover where millions die suffering from the bad economy, OR we somehow manage to survive through this and countries manage to pull through and we get back in track by 2022 at least. But the way things are going, it definitely seems like the first option is more likely to happen, so brace for impact,its going to be a rough ride.

I think it's the opposite way really, ie. a large cause of China's economy contracting being that all of their trade partners are economically crippled right now.

While I suspect that China will be quicker to get their production back up than most of the west, their market is likely to be impacted by decreased international demand. Both because China's main export markets will likely (a) take a little longer to recover and (b) try to increase domestic production wherever possible as to decrease the dependency on international trade.

This is the first time in my lifetime that China's economy has ever contracted.

Consider that, and then remember this is China's official narrative. The reality is worse. China Beige Book estimates a 10-11% GDP contraction after surveying Chinese firms: https://www.reuters.com/article/us-china-economy-business/virus-had-eye-popping-impact-on-chinas-economy-beige-book-idUSKBN21A3R9

It's difficult to comprehend the scale of economic losses this entails. The stock markets are still in disbelief, bucking all the consistently horrible economic data, but the effects are being seen in crude oil prices, which is digging out new lows and looks to be on the edge of collapse. If the bottom falls out for crude oil, the US oil industry will collapse and the Fed will be faced with taking on incredible amounts of corporate debt to keep markets afloat.


It's a mystery. We have no idea what's really going on inside China. The fact that the government is allowing this "second wave" narrative to take hold in the media tells me things are probably much worse than we think.

China are in trade with many countries and China gives out loans in much amount to countries so there economy has influenced in other countries. The pandemic was always going to compress every economy, to add the haven't even done too badly. After the covid 19 saga countries would take time to rebuild

I don't actually think this is the case.

We've seen china drop by about 26% and then rally back, we've seen Europe do the same and while I'm in no doubt Europe can fall further (potentially 25% - as estimated) the US may stand to lose a lot more... Grouping the two together disregards the semi-stable wealth production in Europe and the bubbled assets in the US.

China is so impressive and many countries were amazed in the middle of their sudden liberation and totally, they were the first to hit by the impact of coronavirus but very fast to survive as if nothing which is envious because I think they seem to know the actual situation in advance and basically the number of confirmed cases is lower than which is compared to the US and Italy and it seems that the economy of China is the first poverty alleviation.

I still beleive that chinese economy will recover soon. Like many other economies in the world they are suffering at the moment and have the bigest GDP fall since 1992 but I think that unlike many economies in the european countries in the world they will be back to feet very soon and US and Europe will need much longer period of time so Chinese will have advantage once more.

I have till date believed that the Chinese economy was going to remain strong despite the virus crisis, but I’m stunned to see that their economy is contracting, and I believe this will impact each and every country’s economy who trade a lot with them. Furthermore what do you’ll think that China should do at this stage to arrest this fall, and most importantly do you’ll believe that they’ll be able to repair their economy?.

Source:

https://www.usnews.com/news/national-news/articles/2020-04-17/chinese-economy-contracts-68-as-coronavirus-cases-revised-higher