Covid-19 Destroyed China


 While other countries recorded recovery from the closure of Covid-19, China's economy continued to suffer from strict control measures in addition to being affected by drought.

At least eight provincial-level jurisdictions reported slower or contracted growth in the first nine months of 2022 (January-September) than in the first half (January-June).

This refers to economic reports released from China's 30 provincial-level jurisdictions for the first three quarters of this year, of which 1 other jurisdiction, Shaanxi, has yet to publish its data.

Among the regions that suffered the most significant decline was Hainan with a 0.5% contraction in the first nine months compared to 1.6% growth in the first half of the year.

The impact is so profound because the local economy is dominated by service industries such as tourism.

Meanwhile, Tibet and Xinjiang which are also popular tourist destinations, also saw a sharp slow growth with only 0.2% expansion recorded in Tibet during the period.

In southwest China, the economies of Sichuan and Chongqing provinces also worsened due to extreme heat that forced hydropower plants to reduce electricity production and affected the activity of some factories.

Shanghai's economy shrank 1.4% in the January-September period, but is still showing recovery following a 5.6% drop in the first half of the year following the 2-month lockdown.

From this grim reading, it further highlights the pressure the Chinese economy is facing as a result of the zero Covid policy being practiced.