China becomes one of the only major countries to report growth amidst the COVID-19 pandemic, increasing its economy by around 2%.
This was due to the government’s decision to shut down most of their economy immediately resulting in about a 7% shrinkage. However, this is most likely the reason why Chinese businesses were able to reopen much earlier as compared to western businesses.
However, this is the worst growth China has experienced ever since the 1990s Tiananmen Square democracy movement.
The Chief ING Economist for China, Iris Pang has stated that it is still too early to conclude that this is a full recovery of China’s economy, according to the Associated Press.
“External demand has not yet fully recovered. This is a big hurdle,” she further adds. The soaring demand for medical supplies has been beneficial for China’s exports, however, the weighty tariffs levied by President Trump has resulted in negatively impacting exporters.
The tariffs first set by President Trump will be kept in place by President-elect Biden as he takes up office, he has also been on record for saying that Trump’s approach to China has been “backwards,” all the while stating that he expected the U.S. under Trump’s administration to play by “international norms”.
President-elect 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 also said that Trump’s approach to China has been “backwards.” Overall, China has come closer to the U.S. when it comes to their economic output during 2020.