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NBS: China’s Q2 GDP rises 3.2%, H1 down 1.6%

China’s gross domestic production (GDP) returned to a positive growth of 3.2% on year in the second quarter, enabling the country’s GDP for the first half of 2020 still declined but at 1.6% on year against the 6.8% on-year decline for the first quarter of 2020, according to the latest official data.

The continuing resumption of normal orders in its all economic sectors with the COVID-19 largely under control been the core factor, and for H1 2020, the country’s totol GDP reached Yuan 45.66 trillion ($6.5 trillion), with the fixed asset investment adding up to 28.2 trillion, according to the latest data from the country’s National Bureau of Statistics (NBS) on July 16.

“The 3.2% growth is very encouraging,” A Beijing-based economist commented. “Resumption of normal working orders in all the industries accelerated the pace (in Q2), and the economic activities in most part of China have been almost returning to the level prior to the pandemic outbreak,” he said.

Market observers in and out of China had expected the country’s GDP to grow 2%-3% in the second quarter, Mysteel Global understands.  

“A series of economic rescue and stimulating policies by the Chinese government has shown the effect, and the core driving force for a positive GDP in Q2 was the capital investment in the infrastructure, which supported auto, engineering and machinery sectors, but the risk is that momentum may ease in 2021,” a second Beijing-based analyst shared his concern.

In H1, the industrial output value among the three core sectors still posted the steepest  decline of 1.9% on year to Yuan 17.3 trillion, and the tertiary industry declined 1.6% on year to Yuan 25.8 trillion, but still being the dominant contributor, accounting for 56.4% of the total GDP.

In H1, the output value from all the sizable industrial enterprises decreased 1.3% on year, or 7.1 percentage points less than that in Q1, as the value reversed into a positive gain of 4.4% on year for the second quarter, thanks to the return to normal operations among the industrial sectors.

Among all the industries, the value from the high-technology and machinery manufacturing increased 4.5% and 0.4% on year respectively in the first half, among which, excavators and shovels saw their volumes grew by 16.7% and 16.4% on year respectively, according to the NBS data.

As for the country’s foreign trade, the total value reached Yuan 14.2 trillion over January-June, down 3.2% on year but less steep than the 6.5% on-year decline in Q1, among which, exports value accounted for Yuan 7.7 trillion, down 3% on year with machinery, electrical and electronic products exports contributed to 58.6% of total, or 0.5 percentage point higher than year ago, according to NBS’s statistics

In the first half, China created 5.64 million new jobs, or 62.7% of the annual target, and by the end of June, unemployment rate was at 5.7%, down 0.2 percentage point from May, according to the official data. 

Written by Olivia Zhang, zhangwd@mysteel.com

Edited by Hongmei Li, li.hongmei@mysteel.com