China’s exports increased by 3.6% in 2020, far better than initially expected. China’s GDP grew by 2.3% last year – the slowest since 1976. However, China was also the only major economy showing positive GDP growth. In the fourth quarter of 2020, the Chinese economy grew by 6.5% year-on-year, the National Bureau of Statistics (NBS) said, a remarkable recovery from the historic 6.8% contraction in the first quarter when the coronavirus struck. The solid recovery also lifted China’s GDP to CNY101.6 trillion, a new milestone above the CNY100 trillion mark. According to the World Bank, the U.S. economy is expected to contract by 3.6% in 2020, and the eurozone’s by 7.4%, while the global economy is expected to decline by 4.3%. 

China’s retail sales dropped 3.9% year-on-year in 2020, as consumers cut back spending during the challenging times. The catering sector saw the biggest drop of 16.6% in revenues, as restaurants were forced to close or consumers were restricted to eat out as part of the country’s anti-epidemic efforts. “In 2021, China’s economy is expected to rise strongly in the first and second quarters, and then return to a long-term medium level. Annual growth is expected to be around 9.2%,” ICBC International Economists Cheng Shi and Wang Yuzhe wrote in a research note to the Global Times. Value-added industrial output increased 2.8% year-on-year. Fixed-asset in?vestment (FAI) saw a steady recovery, climbing 2.9% year-on-year in 2020, with investment in high-tech industries, health care and education above average. A total of 11.86 million new urban jobs were created in 2020, 131.8% of the target set for the whole year.

The country’s exports in U.S. dollars grew by 18.1% year-on-year to USD281.93 billion in December. For all of 2020, exports gained 3.6% to USD2.59 trillion, according to Customs data. Imports were up 6.5% to USD203.75 billion in December, while the full-year figure dropped 1.1% to USD2.06 trillion. China became the only major economy in the world to achieve positive commodity trade growth in 2020, General Administration of Customs (GAC) Spokesman Li Kuiwen told a press conference. The country’s exports were up only 0.5% in U.S. dollar terms in 2019, a sharp decline from a 9.9% gain in 2018. Imports shrank by 2.8% in 2019, a free fall from a rise of 15.8% in 2018. China’s exports of medical devices and stay-at-home products surged in 2020, contributing to the global fight against the pandemic. The country’s exports of textile items – including masks – medical instruments and medicines jumped 31% in 2020 year-on-year, boosting overall export growth by 1.9 percentage points. Exports of laptops, tablets and household appliances grew up 22.1%, fueling export growth by 1.3 percentage points. Exports of infrared thermometers rose more than 2,358% in the first half of 2020, reaching USD1.059 billion in value.

Wang Tao, Chief China Economist at UBS, said China’s exports were stronger than expected in 2020, owing to rising demand for protective gear and stay-at-home products. “This was the case even in the U.S. market where Chinese products face higher tariffs,” Wang said, expecting a strong global recovery to help China’s exports surge an estimated 10% in dollar terms this year. A possible slow-down in travel around Chinese Spring Festival this year due to heightened coronavirus control measures would help exporters work around the clock to deliver goods to their buyers. Many regions in the country including Zhejiang and Guangdong provinces, have rolled out measures including Spring Festival subsidies and overtime pay, to encourage migrant workers to avoid traveling to their hometowns for the holidays. The Ministry of Commerce (MOFCOM) is now working with other departments including the Ministry of Transport to increase shipping capacity and stabilize freight rates, Li Xingqian, a Ministry official said. 

China’s auto market saw a forecast-beating performance in 2020 despite the impact of the Covid-19 epidemic. The number of automobiles sold in the country totaled 25.31 million last year, down 1.9% year-on-year, narrowing 6.3 percentage points from the decline seen in 2019, according to the China Association of Automobile Manufacturers (CAAM). In 2020, China produced 25.23 million automobiles, down 2% year-on-year, narrowing 5.5 percentage points from the drop in 2019. In December, auto sales reached 2.83 million, up 6.4% on-year, while production totaled 2.84 million, a 5.7% gain from a year ago. China’s auto exports surged 35.5% on-year to 145,000 units, a historic high. Auto sales are expected to exceed 26 million units in 2021, up 4% year-on-year.