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China’s economic recovery accelerated in the third quarter as consumer spending increased and factories scrambled to meet global demand for medical equipment such as face masks, according to official figures.
The world’s second-largest economy suffered its worst quarterly drop in output since the 1960s between January and March, as it became the first to rebound from the effects of the COVID-19 crisis before its global spread.
It has reported a modest recovery since it reopened its economy, with growth of 3.2% compared to the previous year in the following three months.
The National Bureau of Statistics (NBS) said on Monday that a 4.9% figure was achieved in the third quarter through the end of September.
The figure confirms a continuation of the ‘V-shaped’ recovery, elusive in the UK and elsewhere due to second wave coronavirus infections.
While growth was slightly weaker than analysts expected, they noted that encouraging data from the final month of the period gives good reason for optimism.
Retail sales grew 3.3% in September from a year earlier, accelerating from a modest 0.5% increase in August, while car sales were up nearly 13% from the previous month.
Factory production is increasing despite weak demand from abroad as key export markets continue to be damaged by virus restrictions
Industrial production grew 6.9% after a 5.6% increase in August.
An incipient economic recovery in China is expected to help fuel the growth engine elsewhere in the coming months.
But there are concerns in Beijing that demand for Chinese products abroad remains volatile as the economic fallout from the pandemic continues to hit key markets, including Europe.
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NBS spokesman Liu Aihua said: “At this time, the epidemic situation abroad remains dire.
“We are also faced with the instability and uncertainty of international circumstances. Effective domestic demand remains insufficient.
“Recoveries from different industries and regions are still out of balance. Much needs to be done to consolidate the foundation for sustainable economic growth.”
China has suspended additional post-crisis stimulus to get the economy moving in recent months, fearing to increase its huge debt at a time of weaker demand.
Authorities have taken steps to create 9 million jobs after more than 20 million factory workers were feared to lose their jobs in the wake of the virus shutdown.
Independent analysts estimated that 130 million people were out of work, at least temporarily, during the country’s shutdown.
Nonetheless, the International Monetary Fund has forecast 1.9% growth in China throughout the year.
China would be, in this scenario, the only large economy that would probably register an increase in year-on-year production.
