China’s economy grew at the slowest pace since the start of the COVID-19 pandemic in the second quarter, highlighting the punishing economic toll of Beijing’s stringent “dynamic zero COVID” strategy.
The world’s second-largest economy expanded just 0.4 percent year on year between April and June, official data showed on Friday, as lockdowns across the country stifled industrial production and consumer spending.
The meagre expansion was the worst performance since the first quarter of 2020, when China’s economy shrank 6.9 percent after authorities imposed the first COVID-related lockdowns in the city of Wuhan.
The result, which was well below market expectations, comes amid rising fears that the world could slip into recession as the war in Ukraine, supply chain disruptions, and rising interest rates cloud the outlook for growth.
“The data was weaker than expected, with most analysts expecting around 1 percent,” Carlos Casanova, senior economist for Asia at UBP in Hong Kong, told Al Jazeera.
“We were below consensus, as we expected the decline in China’s housing sector to drag on aggregate demand, reducing the likelihood of a sharper rebound in consumption in June.”
Casanova said he expected growth in 2022 to remain below 4 percent.
Despite the weak overall performance, industrial output and retail sales both rebounded strongly from previous lulls.