Solid Chinese Economic Growth For Five Decades, Then COVID-19

People on all sides of the pacific have been able to agree on one thing for the most part when it came to China until now. That being the  Chinese economy has displayed positive increase every  year for over fifty years. That is just about half of a century where there wasn’t a single unfavorable quarter. This all came to an end when China posted its most latest economic measurements.

The Chinese Governments Response to the Economic Retraction

The economy has released its first decrease in the Peoples Republic of China. Their GDP shrank by nearly 6% in the previous quarter. For a country that has been used to seeing GDP expansion of between 6-10% over the last decade every year including the financial tragedy of 2008, this is a drop of just about 20% compared to the previous forecasts for the country. The CPC has moved on a number of measures to try and combat this growing recession.

Make Borrowing Easier by Lowering Interest Rates

They have followed the lead of most of the world’s central banks and decreased their interest rates to make money more affordable to access for businesses and consumers.

Lowering Business Taxes to Help Economy

A number of tax cuts that have been created to put more money into the economy have been passed by the government comparable to many western nations’ fiscal policy updates of late.

Businesses Get Handful of Tax Credits

Finally, they have developed a series of new tax credits that can be applied retroactively for businesses. This allows businesses to essentially get a raffle for money they have previously paid in taxes in previous years.

Manufacturing Decline Has Slowed

There are a couple of pieces of good news in all of this negativity. The stock market in China has been showing some gains over the last couple of days. Also, the countries unemployment indicators have shown a slight decrease around one-third of a percent less than the previous month. Manufacturing output also saw a lower level of decline than state economists had predicted the last month.

More information is available at The Telegraph and The Hill

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