China industrial output, retail sales surge in pandemic rebound

BEIJING (AFP) – China’s industrial output and retail sales surged in the first two months of the year, official data showed yesterday, underscoring the country’s recovery from the coronavirus pandemic.

Industrial production spiked a forecast-busting 35.1 per cent on-year, the biggest bounce in decades, while retail sales also beat expectations with 33.8-percent growth.

But the National Bureau of Statistics (NBS) said the latest surge was in part due to distortions from last year’s “low base in the same period”.

Both indicators plunged in the early months of 2020 after COVID-19 surfaced in central China and spread rapidly around the country.

However, the world’s second-largest economy became the first to bounce back globally after imposing strict lockdowns and virus control measures, clocking a full-year economic growth of 2.3 per cent.

Employees work on an air conditioner production line at a Midea factory in Wuhan, in central China’s Hubei province. PHOTO: AFP

“After removing the base effect, the growth of main indicators is stable and macro indicators are in a reasonable range,” said the NBS.

Data for January and February were released together to eliminate the influence of uncertainties brought about by China’s Lunar New Year holiday, which typically falls within this period. Industrial output in the first two months was up almost 17 per cent from the corresponding period in 2019, authorities said.

Industrial activity was likely boosted by the fact that many migrant workers were discouraged from returning to their hometowns because of COVID-19 restrictions, meaning some factories remained open through the holiday or re-opened sooner.

“We expect activity to remain strong in the near-term, as the easing of virus restrictions boosts consumption and fiscal stimulus among key trading partners should keep exports strong,” said Capital Economics senior China economist Julian Evans-Pritchard.