Economy of PRC: review of the country’s market after the pandemic
The Chinese economy is going through difficult times, and in order to understand how it will develop further, analysts studied the problems of the segment and the methods to solve them.
New programs are in place to support small and medium-sized businesses in China. In addition, over the past year, the government managed to restore production processes in a short period of time and achieve its previous goals of creating 9 million new jobs. Special attention is paid to the problem of employment, which includes measures to employ graduates of local universities, workers from other countries, retired military personnel. The government allocates funds to restore the work of small companies so that they do not reduce their staff and expand their businesses. To reduce unemployment, special attention is given to new areas of the economy. There are also programs for professional training to retrain workers.
The growth rate of the country’s economy is growing. In the second quarter its indices became much higher than in the first one and this trend continues. The situation in China is influenced by the global situation and demand recovery. In the third quarter of last year, the economy growth reached 6%, in annual terms, the increase was recorded at about 2.5%.
Experts have several options for the development of events. According to the pessimistic scenario, the pandemic will not contribute to a rapid recovery in demand and China this year will show lower results than its government expects. If the scenario is positive, due to the active increase in demand for Chinese products, the growth of the country’s economy will reach higher values than in previous periods.
Consumption in China’s domestic market has fallen along with global demand. In this case there is no sharp jump, but the dynamics are positive and stable, which allows us to give optimistic forecasts for the near future. However, there are also factors that slow down the recovery rate of consumption. First of all, there is a lack of support from certain segments of the population at the state level.
In this segment an uneven growth rate of development is observed. For example, first of all, there is a growing demand for drugs and products related to anti-epidemic measures: masks, disinfectants.
Consumption of essential goods is also increasing; there is activity on the real estate market and in the service segment.
The volume of investments last year increased by 8% compared to 2019. Large investments are observed in the segment of infrastructure construction, which is also supported by the fiscal policy of the authorities. The market interest rate has been reduced and the government authorities clearly control real estate pricing in order to avoid an increase in speculative activities and artificial overstatement of value.