China’s gross domestic product (GDP) fell by 6.8% year on year in January-March. According to official data, the analysts saw a more significant decline of 6.5% on Friday, after a 6% expansion in the fourth quarter of 2019 on a year-on-year basis. It was the first decline in the world’s second largest economy since 1992.
On a quarterly basis, GDP fell by 9.8% in the first three months of the year, according to the National Statistical Office, which predicted a slightly higher decline of 0.1% to 9.9% compared to the previous quarter, when China reported 1.5%. % growth.
However, analysts say Beijing is facing a fierce struggle to boost growth and halt massive job losses, as the global spread of the virus destroys the demand of major trading partners and also affects the fall in domestic consumption.
“In the next phase, the lack of overall demand is of concern. Domestic demand has not fully recovered, as consumption related to social gatherings is still banned, while external demand is likely to continue to be disturbed due to country closures to limit the spread of the pandemic.
On the other hand, production fell much less than expected in March, suggesting that tax and tax relief for companies affected by the virus are helping to relaunch parts of the economy that have stopped since February.
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