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Short-term Omicron pain not to change fundamentals of Chinese economy

Xinhua | Updated: 2022-04-20 07:54
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Workers work at a factory of Harbin Boiler Co Ltd of Harbin Electric Corporation in Harbin, Northeast China's Heilongjiang province, April 14, 2022. [Photo/Xinhua]

Despite the onslaught of Omicron, China's economy forged ahead in the first quarter of the year. The pandemic will not change the fundamentals of the nation's economy.

Gross domestic product grew 4.8 percent in the period from a year earlier, data from the National Bureau of Statistics showed on Monday, outpacing the fourth quarter's 4 percent.

Value-added industrial output rose 6.5 percent year on year, while foreign investment and foreign trade continued to grow at double digits. The nation's foreign exchange reserves stood at around 3.2 trillion U.S. dollars at the end of March.

As main indicators operated within an appropriate range in the first quarter, the economy got off to a steady start in the year 2022.

It is true that some economic indicators had their momentum checked in March when Omicron, the highly infectious strain, spread to multiple cities including business hub Shanghai. The purchasing managers' index for the manufacturing sector, for example, slid to 49.5 percent, down 0.7 percentage points from February. Exports slowed down while imports posted year-on-year negative growth for the first time since September 2020.

But China is in a good position to recover from the ongoing wave of outbreaks, especially given its remarkable record over the past two years.

The industrial system is whole and complete. The nation's infrastructure is being continuously upgraded and its market capacity is massive. Innovation-driven development continues to deliver. Not to mention the strong policy support available from the government.

The country also leads the world in epidemic prevention and control. Senior WHO official Michael Ryan praised the anti-virus approach of China on March 30, saying that it has kept infection rates, death rates and hospitalization rates all at a "very, very low" level and the society and the economy could continue to function pretty well through the pandemic.

China has always emphasized the importance of coordinating epidemic response and economic and social development. Rich experience has been accumulated over the past two years, which in turn will pay dividends.

The downward pressure inflicted by COVID-19 is short-term in nature. There are more favorable conditions that can facilitate China to deliver another year of stable growth.

Consumption, contributing 69.4 percent to GDP expansion in the first quarter, will resume its recovery trend after the outbreaks are subdued. Investment, industrial upgrades and other factors are there for the country to leverage.

We must look at the big picture. China has both the capability and resources to rise above the difficulties and achieve stable and sound economic development.

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