As the Chinese economy rebounds and life goes back to normal, China also shows that there is no trade-off between saving lives and and saving the economy. The latter requires the former as indispensable condition.
While the West keeps on stagnating, alternating between half-measures, tentative re-opening, followed by more half-measures, the Chinese economy has gone back to growth because the pandemic has been dealt with.
If democracy is damaged because democratic regimes are incapable of coping with the pandemic, it won't be because of China. It'll be because democratic leaders can't tell unpopular truth to people at a time of rampant populism. Democracy can't survive without a degree of political maturity. Populism is the death of democracy.
China’s economic rebound from the coronavirus pandemic gathered pace in August with a poll indicating the services sector grew at its fastest pace in more than two years.
The world’s second-largest economy has put the US and much of Europe in the shade with a quick recovery after Covid-19 restrictions were eased.
Activity continued to recover in August, with a gauge of the services industry reaching its strongest level since early 2018 while the expansion in manufacturing activity slowed slightly.
The purchasing managers’ index (PMI) for services rose to 55.2 from 54.2 in July, according to the National Bureau of Statistics.
A reading above 50 indicates conditions improved from a month earlier. Manufacturing growth slowed marginally, with the PMI dropping to 51 from 51.1 a month earlier. The PMI for small manufacturers continued to decline, dropping to 47.7.
China’s recovery from a slump in the first quarter of 2020 was boosted by government investment, while the reopening of some trading partners helped to support exports – an important part of the Chinese economy.
Service industries, which have been hit hard by the virus, picked up as the government relaxed its lockdown measures, with businesses such as cinemas allowed to open again.
A number of indicators suggest China’s economy strengthened in August, with the stock market, business confidence and home sales all improving.
“Both the manufacturing and services PMIs are expected to stabilise within expansionary territory, with the possibility of a slight acceleration,” said Liu Xuezhi, an economist at the Bank of Communications in Shanghai.
“It’s unlikely that policymakers will roll out large stimulus [measures] over the rest of the year, and they shouldn’t. They should instead focus on implementing existing policies.”
Demand for manufactured goods is increasing but firms are still suffering from a lack of demand.
“The recovery of demand is slower than that of production, which is starting to drag on the economic recovery,” the China Logistics Information Centre, which helped compile the data, wrote in a statement.
“More than half of companies still list the lack of market demand as the main difficulty”, a factor which is making them reluctant to invest in additional production, the organisation said.
Chang Shu, at Bloomberg Economics, said: “Looking ahead, we expect the recovery to continue to make headway, propelled by incremental increases in domestic demand and further opening of overseas economies. That said, returning to pre-pandemic growth rates anytime soon would be a tall order.”