Economic Growth Rate of China Projected at 5.4% Amid Impact of Novel Coronavirus

Oxford Economics Forecasts China's Economic Growth Rate at 5.4%

[Image source=EPA Yonhap News]

[Asia Economy Reporter Jin-gyu Lee] Due to the impact of the novel coronavirus infection (Wuhan pneumonia), there are forecasts that China will find it difficult to achieve an economic growth rate of 6% this year.

On the 7th, according to Hong Kong's South China Morning Post (SCMP) and others, the British economic analysis firm Oxford Economics lowered China's economic growth forecast for this year from the previous 6% to 5.4%.

UBS economist Wang Tao also projected that China's economy will grow by only 3.8% in the first quarter, with the overall growth rate for this year expected to be 5.4%.

China's Lunar New Year holiday was originally scheduled from the 24th to the 30th of last month, but as concerns over the novel coronavirus spread, the Chinese government extended the holiday until the 2nd of this month to prevent population movement. Even after that, many regions in China, including Beijing and Shanghai, postponed the return to work until around the 10th. With city lockdowns increasing, including in the Wuhan area, there are observations that China's retail sales, transportation, tourism, and food industries have been directly hit by this situation.

Previously, China experienced economic shocks during the Severe Acute Respiratory Syndrome (SARS) outbreak in 2003. China's Gross Domestic Product (GDP) growth rate was 11.1% in the first quarter of 2003 before the SARS impact hit, but it sharply dropped to 9.1% in the second quarter. In response, the Chinese government launched aggressive economic stimulus measures, and the GDP growth rate somewhat recovered to 10% in the third quarter of that year.

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