BEIJING: Official data showed today that industrial production and retail sales in China rose in the first two months of the year, confirming the country’s recovery from the Coronavirus pandemic.
Industrial production rose 35.1% year-on-year, the biggest bounce in decades, while retail sales also beat expectations with a 33.8% growth.
But the National Bureau of Statistics said the recent increase was partly due to distortions from “the low base last year in the same period”.
Both indicators declined in the first months of 2020 after Covid-19 emerged in central China and quickly spread across the country.
But the world’s second-largest economy became the first to recover after strict lockdowns and virus-control measures were imposed, and recorded full-year economic growth of 2.3%.
“After removing the basic effect, the growth of the main indicators is stable, and the overall indicators are within a reasonable range,” the National Bureau of Statistics said.
Data for January and February were released together to eliminate the impact of uncertainty caused by the Chinese Lunar New Year holiday, which usually falls during this period.
Industrial output increased in the first two months by 16.9%.
Industrial activity was likely boosted by the fact that many migrant workers were discouraged from returning to their hometowns due to Covid-19 restrictions, which means some factories have remained open during the holiday or reopened sooner.
“We expect activity to remain robust in the near term, as virus easing restrictions boost consumption, and fiscal stimulus among major trading partners should keep exports strong,” said Julian Evans-Pritchard, chief Chinese economist at Capital Economics.
Data on Monday showed the unemployment rate in cities rose to 5.5% in February, up from 5.2% in December, but experts warn that the real rate could be higher due to the rise in the number of workers in informal jobs.
“Although we are seeing improvement in the global economic environment, they are still very cautious,” said Tommy Zi, head of Greater China Research at OCBC, on the issue of unemployment.
He noted that the urban unemployment rate is still within the government’s goal, adding that the caution is likely to be due to another possible record for graduates entering the labor market this year.
He added that there was an “uneven recovery” continuing as well, with smaller companies and industries such as travel not fully recovering from the coronavirus.