The Chinese economy continued its recovery in the first quarter of 2021, as GDP growth accelerated to the fastest rate on record. According to the National Bureau of Statistics of China, the country’s GDP grew by 18.3 percent year-over-year in the three months ended March 31, up from 6.5 percent in the final three months of 2020. Comparing the latest jump to previous quarters is a bit misleading, however, as the coronavirus lockdown hit the Chinese economy with full force in Q1 2020, lowering the baseline for the latest reading. Nevertheless, the latest uptick more than made up for last year’s slump, bringing average first-quarter growth back up to five percent for the past two years.
In the first three months of 2020, the coronavirus outbreak had resulted in the first quarterly GDP decline in decades for the world’s second largest economy. And while the swift rebound resulted in 2.3 percent growth for the entirety of 2020, that is still equivalent to the worst result since 1976 for the notoriously booming economy. Nevertheless the pace of China’s recovery exceeded expectations, as the IMF and World Bank had predicted 1.85 and 2.0 percent growth for 2020 in their latest economic outlooks, respectively.
China’s economic output had declined by 6.8 percent year-over-year in the first three months of 2020, after the coronavirus outbreak which originated in Wuhan (Hubei province) in December and the ensuing lockdown had stopped the country in its tracks. Prior to the COVID-19 crisis, China’s economic growth had stabilized around 6 percent following a gradual slowdown from more than 10 percent growth in the first decade of the 21st century.
This chart shows China’s quarterly real GDP growth since Q1 1992.
