Will the mutated virus strain "derail" the global economic recovery?
Beijing, August 4 (China News Service) -- The gdp data of major economies around the world in the second quarter are being released one after another. In the context of the overall recovery, economic growth in some countries has fallen short of expectations. The rapid spread of the Delta strain of the new coronavirus variant virus has brought more variables. Will the global economic recovery process be "derailed" as a result?
Judging from the published data, the world's top two economies, the United States and China, have continued to recover. China's semi-annual economic report released on July 15 showed that in the second quarter, China's GDP was 282857 billion yuan, an increase of 7.9% year-on-year at constant prices; the average growth rate in two years was 5.5%, 0.5 percentage points faster than the average growth rate in the first quarter.
The U.S. Department of Commerce's first estimates released on July 29 showed that real GDP in the United States grew by 6.5 percent at an annual rate in the second quarter of this year, below the 8.5 percent expected by the market. Although the U.S. economy continued to recover under multiple factors such as wider vaccination with COVID-19 vaccines and the expansion of the scope of economic activity in the US states, the above growth figure was only slightly higher than the 6.3% in the first quarter, which was far from market expectations.
Turn your attention to Europe. Preliminary statistics released by Eurostat show that on a seasonally adjusted basis, the euro area's GDP in the second quarter of this year grew by 2% month-on-month and 13.7% year-on-year; eugenic GDP increased by 1.9% month-on-month, an increase of 13.2% year-on-year. However, Germany, the EU's traditional economic powerhouse, has not performed well. In the second quarter, German GDP grew 1.5% month-on-month, down from the 2% economists had previously expected.
In addition, data from the Russian Ministry of Economic Development shows that Russian GDP increased by 10.1% year-on-year in the second quarter, an increase of 1.5% compared with the second quarter of 2019. The sector expects russia's economy to grow by 3.8 percent this year, the highest since 2012.
In Asia, China's economic recovery has taken the lead in bringing benefits to neighboring countries. Japan has yet to release second-quarter GDP data, but foreign trade data has been released showing that its exports in the first half of this year surged 23.2% year-on-year, exceeding the level of the first half of 2019 before the outbreak of the new crown epidemic. Due to the steady recovery of China's economy, Japan's exports to China increased by 27% year-on-year to 8.60 trillion yen in the first half of this year, and China continued to maintain Japan's largest export market position.
According to preliminary accounting data released by the Bank of Korea, South Korea's GDP in the second quarter of this year increased by 0.7% month-on-month. But whether the full-year growth target of 4% can be achieved will also depend on the economic growth rate in the third quarter under the fourth wave of the epidemic.
Although the performance of some countries fell short of expectations, the general trend of global economic recovery in the first half of the year remained the same. Wang Qian, chief economist of the Asia-Pacific region of the Pioneer Pilot Investment Strategy and Research Department, pointed out that in order to effectively fight the epidemic, countries around the world have generally taken unprecedented decisive and resolute measures, laying a solid foundation for a strong economic recovery. Vaccines are being developed, tested and launched much faster than expected, and governments and central banks are jumping on the line to introduce fiscal and monetary support policies.
However, Wang Qian also said bluntly that there are large differences in vaccination rates in different countries and regions, and the effectiveness of governments in mitigating the economic impact of the epidemic is also different. With the combined effect of these two factors, the economic recovery trend around the world in the second half of this year and beyond will continue to be uneven. Judging from the full-year forecast, there is still a long way to go before gdp growth returns to pre-pandemic levels.
What needs to be more vigilant is the spread of the Delta strain of the new crown mutation virus around the world, which has once again increased the uncertainty of the global economic recovery.
For example, the report released by the Zhixin Investment Research Institute said that under the influence of virus mutation and large-scale rebound, the global manufacturing industry showed a more obvious slowdown trend in July. Manufacturing growth in the eurozone was the slowest since February and in the United States since January, and while manufacturing activity in Japan and South Korea in the region grew, China's expansion continued to slow as ASEAN fell to a 13-month low. The report reminds that countries still cannot relax their vigilance against the epidemic.
Ding Shuang, chief economist of Standard Chartered Bank Greater China and North Asia, said that the mutated virus strain is very contagious, and the effectiveness of the existing vaccine has still to be verified, which may drag down the economic restart of some countries, thus affecting the global recovery process. However, from a positive point of view, all parties have accumulated a lot of experience in the process of responding to the virus, the response measures are more mature, vaccine research and development is constantly advancing, and the impact of each round of repeated epidemics on the economy is marginally decreasing.
"Taken together, it (the mutated strain) is a big risk, but it doesn't 'derail' the global recovery at the moment." Ding Shuang said. (End)
Source: China News Network