China Celebrates Coronavirus Economy Recovery As U.S. Battles Recession

China has posted a higher rate of economic growth than expected in the second quarter of this year, making it the first major economy to exit the COVID-19 coronavirus slump.

The Chinese economy grew 3.2 percent in the second quarter of this year, following a record contraction in the first quarter as the country grappled with the coronavirus pandemic.

Then, the economy was 6.8 percent smaller than the year before, representing the first full-year contraction since at least the early 1990s.

The second quarter performance means China has escaped the technical definition of a recession, two consecutive quarters of negative growth.

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By contrast, the U.S. has already entered its first official recession since the financial crisis of 2009, and the pain looks set to be extended by the apparent inability of President Donald Trump's administration to control the spread of COVID-19 and make it safe to re-open the economy.

China's growth figure is higher than expected and points to a possible "V-shaped" recovery—a rapid return to growth following the sudden contraction caused by the coronavirus lockdown, which shuttered factories and businesses across the country as authorities battled COVID-19's spread.

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Beijing introduced a range of stimulus measures to push the economy back towards growth worth some $559 billion—the largest ever proposed by a Chinese government. Premier Li Keqiang told Chinese lawmakers in May: "If our targets of protecting jobs, livelihoods and market entities can be achieved, we'll be able to achieve a positive economic growth rate in 2020."

But encouraging Chinese growth could yet be hamstrung by slow recoveries elsewhere. Poor performance in the rest of the world's major economies is bad news for China, and spiraling disputes with the U.S. and other Western democracies could yet produce more sanctions undermining growth and investment.

The BBC cited a note from Deutsche Bank which declared the V-shaped recovery "largely completed." But gaps remain in sectors like travel, dining and leisure where consumer spending is the primary driver. Here, "rapid recovery is unlikely," the bank said.

Still, Chinese state-run media celebrated the better-than-expected second quarter figure. The nationalistic Global Times newspaper said China could "achieve best-in-class results among the world's major economies and lead the global recovery in the wake of the pandemic."

The People's Daily—the official newspaper of the Chinese Communist Party—quoted China's National Statistics Bureau declaring that the economy "overcame the adverse impact of the epidemic" and "demonstrated a momentum of gradual recovery, further manifesting its development resilience and vitality."

China was able to quickly stem COVID-19 transmission through draconian restrictions, though it has been accused of underplaying the true number of infections and deaths in the country. Beijing has also been accused—particularly by Trump and his allies in the U.S.—of failing to properly warn the international community of the threat posed by COVID-19.

More than 584,000 people worldwide have died from coronavirus, with more than 13.5 million confirmed infections, according to Johns Hopkins University. The virus originated in the central Chinese city of Wuhan at the end of 2019, but the U.S. is now the world's worst affected country with nearly 3.5 million cases and 137,000 deaths.

China has officially recorded 85,246 infections and 4,644 deaths.

China, US, economy, recovery, coronavirus, recession, growth
Employees work on a truck assembly line at a factory in Fuyang in China's eastern Anhui province on July 16, 2020. STR/AFP via Getty Images/Getty
China Celebrates Coronavirus Economy Recovery As U.S. Battles Recession | World