The year 2022 is coming to an end. Looking back on the past year of challenges and instability, China has paid a heavy economic price due to the Chinese Communist Party (CCP)’s zero-COVID policy.
According to NTD, China’s economy has suffered a severe recession, the retail industry has suffered a wave of lockdowns, and the unemployment rate has continued to soar. The income of migrant workers has dropped by 90%.
VOA reported that the World Bank, International Monetary Fund, and other organizations estimate that China’s GDP growth rate in 2022 will be between 2.8% and 3.2%, much lower than the 5.5% set by CCP.
A resident of Hubei province told VOA that the income of migrant workers in his village had plummeted this year, and many have even lost their income.
This person said that due to the sharp decline in income, he had reduced his monthly expenses from more than 5,000 yuan (nearly $700) to less than 3,000 yuan.
Not only has personal income plummeted, but CCP’s zero-COVID policy has wrecked China’s retail industry. One of the representatives is a small restaurant owner, they had to close their restaurant due to a sudden drop in customers.
NTD cited data from Qichacha reporting that as of the end of November, 496,000 food-related businesses in China have unsubscribed. In addition, 1.9 million retail businesses have closed.
A prime example: Carrefour, a popular supermarket, closed more than 50 stores in the first three quarters of this year, while Chinese home appliance retail giants such as Suning.com and Gome filed applications for bankruptcy.
Lin Changnian, CEO of Hong Kong Zhiyi Oriental Securities Co., Ltd., said in an interview with Voice of America that since the beginning of this year, China’s zero-COVID policy has caused retail sales to fall at least 30-50%.
Along with the disruption of the manufacturing supply chain, China’s manufacturing capacity has been hit hard, and this will affect China’s GDP growth.
Lin believes that the downturn of pillar industries has cost China at least three percentage points of GDP.
At the dialogue between the leaders of China and the European Union on December 15, Chinese Vice Premier Liu He affirmed that real estate is a pillar sector of the Chinese economy.
However, Chinese real estate has been in decline for many months. For example, Da Ji Yuan reported that sales of China’s top 100 real estate companies fell by 42.1% this year.
In the first 11 months of this year, China’s real estate investment fell 9.8% year-on-year. Among them, housing investment decreased by 9.2% over the same period.
Liu He said that China’s urbanization is still in a stage of relatively rapid development, so the development space for the real estate market is still there.
Liu added that China’s regime would have policies to promote real estate.
Financial analyst Jiang Tianming told Da Ji Yuan on December 17 that the CCP’s real estate policies are unlikely to be effective because it is not easy to regain homebuyers’ confidence.