China becomes only major world economy to report growth in 2020
China’s economy increased by about 2 percent in 2020, becoming one of the only major countries to report such growth in the midst of an economically devastating pandemic.
Economic activity in China shrunk by nearly 7 percent in the first quarter of last year, The Associated Press reports. However, the government’s decision to swiftly shut down most of its economy appeared to have allowed the country to reopen businesses earlier than others.
However, the AP reported that 2020 was still the worst year in terms of growth for China since the 1990s, when the country faced international isolation following the Tiananmen Square massacre.
Iris Pang, chief ING economist for the China region, told the AP that “it is too early to conclude that this is a full recovery,” despite the relatively positive growth the country saw.
“External demand has not yet fully recovered. This is a big hurdle,” added Pang.
The demand for medical supplies such as masks has been a boon for Chinese-made exports, but heavy tariffs levied by President Trump have negatively affected exporters.
President-elect Joe Biden has indicated that he will keep Trump’s tariffs in place once he assumes office. In his first interview after winning the presidential election, Biden said that Trump’s approach to China had been “backwards,” while also stating he expected the country to play by “international norms” during his administration.
The pandemic’s effect on the global economy brought China closer to the U.S. in terms of economic output, the AP notes, with its total activity amounting to roughly $15.6 trillion, about 75 percent of the $20.8 trillion projected for the U.S. by the International Monetary Fund. The U.S. economy is expected to shrink by about 4.3 percent in 2020.