China's factories restart as global coronavirus deaths cross 300,000
15 May 2020
China’s factory output rose in April, for the first time this year, as the world’s second-largest economy slowly emerged from its coronavirus lockdown, while global coronavirus deaths passed 300,000 on Thursday and Covid-19 tally neared 4.5 million.
Industrial production in China rose 3.9 per cent year-on-year in April against a 1.1 per cent fall in March, official data showed.
The production of oil, coal, metals and electricity increased as factories restarted operations in April, as China reopened its economy after months of lockdown imposed in the wake of the spread of the coronavirus.
However, China needs overseas markets to sustain production as domestic consumption continues to face major challenges with the services sector, particularly retail, as the pandemic continues to raise its head in areas where lockdown restrictions have eased.
Manufacturers are struggling with reduced or cancelled overseas orders as global demand falters and producer prices continue to fall as industrial demand weakens, data showed.
China’s exports unexpectedly rose in April aided by demand for medical supplies, but that demand waned as Chinese supplies turned out to be substandard and countries boosted local supplies to cope with demand.
China’s economy shrank in the first quarter of the year, as restrictions to curb the spread of the virus halted economic activity – the first time in nearly two decades
Of particular concern is the collapse in export, which has significant implications for the industrial sector, a major employer in China. This poses significant risk of unemployment for the nation of 1.4 billion.
China’s unemployment rate was 6.0 per cent in April, slightly higher than the previous month.
With most migrant workers returning to their cities of employment from their home towns in April, China will have to focus on migrant workers, who are a significant part of the workforce.
China’s consumer spending remained weak in April with retail sales falling 7.5 per cent as shops and restaurants across the country closed.
Fixed-asset investment fell 10.3 per cent in January-April, compared with a 16.1 per cent decline in January-March.
Private sector fixed-asset investment, which accounts for 60 percent of total investment, fell 13.3 per cent in January-April, compared with an 18.8 per cent decline in the first three months of the year.
China’s property sector, however, showed some resilience with real estate investment quickening in April while property sales fell at a much slower pace, providing some relief for authorities.
The first COVID-19 death was reported on 10 January in China’s Wuhan. It took 91 days for the global toll to pass 100,000 but just a further 16 days to reach 200,000. It took 19 days to go from 200,000 to 300,000 deaths.
The United States has reported more than 85,000 deaths from the new coronavirus. The United Kingdom and Italy have reported more than 30,000 fatalities each and France and Spain have reported more than 27,000 each.
Brazil claims the sixth highest death toll with a much lower 13,149 fatalities, but its casualty rate is climbing quickly. It has reported an average of almost 700 new cases each day over the past week.
The death tolls across Asia and the Middle East have been significantly lower despite heavily populated nations and often lower standards of health care, raising concerns among health experts that the true numbers are far higher.
A US government whistleblower said the United States could face “the darkest winter” of recent times if it does not improve its response to the pandemic. “Our window of opportunity is closing,” Rick Bright, the former director of the Biomedical Advanced Research and Development Authority, testified to a US House of Representatives panel.
“If we fail to improve our response now, based on science, I fear the pandemic will get worse and be prolonged,” Bright, who said he was removed from the post for raising concerns about preparedness, told the panel. He has been re-assigned to another government job.
Yet, the numbers fall far short of the 1918 Spanish flu, which infected an estimated 500 million people and killed at least 10 per cent of those affected.