Understanding the impact of Covid-19 on China's economy and its response plan

Dr Sheng explaining the economic situations faced by China

A webinar titled “Covid-19 Impacts on China's Economy and its Response Plan (新冠疫情对中国经济的影响以及其应对经验)” was co-organised by Tun Tan Cheng Lock Centre for Social and Policy Studies (TCLC), Centre for International Study (CIS) and Centre for Foundation Studies of Sungai Long Campus (CFS) on 19 March 2021. The webinar was hosted on Zoom with an attendance of 297 participants.

The invited speaker was Shanghai Academy of Social Science Institute of World Economy National and Regional Economic Research Office Deputy Director Assoc Prof Dr Sheng Lei (盛垒博士). Dr Sheng’s research areas were mainly related to macroeconomic, technology and innovation, regional economy and urban development. Recently, he has been focusing on China and the global economic transformation.

Dr Sheng started his webinar by explaining the economic situations faced by China, “Over the past year, I believe all of us know that the Covid-19 pandemic was beyond everyone's expectation. The Covid-19 pandemic has brought a very serious impact on the global economy as well as China’s economy. China was hit hard by a severe recession; we can see that the impact now is more serious compared to the SARS outbreak in 2003 and financial crisis in 2008.”

In the webinar, Dr Sheng focused on three main topics, namely 2020 global economic situations, 2020 China economic situations which included employment (就业), foreign trade (外贸), foreign capital (外资), consumer spending (消费), income (收入) and tourism (旅游业), and the reasons for China’s economic recovery and its plan.

“The world's major economies were hit hard by the pandemic; International Monetary Fund (IMF) projected a deep recession in 2020. Global growth is projected to be -4.4 per cent, advanced economies to be -5.8 per cent, and emerging and developing economies to be -3.3 per cent,” said Dr Sheng.

Speaking of China’s economic situations in 2020, he said, “In 2020, China experienced three major pressures: firstly, the serious impact from Covid-19 pandemic; secondly, the recession that took place in the global economy; thirdly, United States’ containment towards China. While facing these three major pressures, China's economy still managed to achieve good results. The economy improved quarter by quarter and gradually returned to normal.”

Dr Sheng added, “The world economic situations are still in a very complex and challenging stage as most of the countries have tightened their borders to fight the pandemic. Furthermore, the supply and demand chain was greatly affected and the domestic demand was insufficient. The consumers in China are still in a recovery stage and lagging. The small and medium-sized enterprises and individual businesses were affected the most during the Covid-19 pandemic. The hospitality industries and tourism industries have still not fully recovered from the pandemic.”

Nearing the end of the webinar, Dr Sheng concluded, “Resilience” is the key to determine the speedy recovery performance of China in the economic sector. Economic resilience saw the capacity of an economy to resist a particular shock and to recover rapidly to the previous level of growth or better. In the process of battling with the Covid-19 pandemic, China has shown a great resilience by not only withstanding the huge impact of the pandemic but also providing rapid economic recovery.”

Dr Sheng explaining the GDP trend of China’s economy

The talk concluded with an extensive yet insightful Q&A session.