section_path: Economic impact by continent, region and country/Asia/East Asia/Mainland China/Economy
section_name: Economy
paragraph_text: Economy
  
  China's economic growth is expected to slow by up to 1.1% in the first half of 2020 as economic activity is negatively affected by the new coronavirus pandemic, according to a Morgan Stanley study cited by Reuters. But on 1 February 2020, the People's Bank of China said that the impact of the epidemic on China's economy was temporary and that the fundamentals of China's long-term positive and high-quality growth remained unchanged. In late January, economists predicted a V-shaped recovery. By March, it was much more uncertain.
  
  Due to the outbreak, the Shanghai Stock Exchange and the Shenzhen Stock Exchange announced that with the approval of the China Securities Regulatory Commission, the closing time for the Spring Festival will be extended to 2 February and trading will resume on 3 February. Before that, on 23 January, the last trading day of a shares before the Spring Festival, all three major stock indexes opened lower, creating a drop of about 3%, and the Shanghai Composite Index fell below 3000. On 2 February, the first trading day after the holiday, the three major indexes even set a record low opening of about 8%. By the end of the day, the decline narrowed slightly to about 7%, the Shenzhen index fell below 10,000 points, a total of 3,177 stocks in the two markets fell.
  
  The People's Bank of China and the State Administration of Foreign Exchange have announced that the inter-bank Renminbi foreign exchange market, the foreign currency-to-market and the foreign currency market will extend their holiday closed until 2 February 2020. When the market opened on 3 February, the Renminbi was now depreciating against major foreign currencies. The central parity rate of the Renminbi against the US dollar opened at 6.9249, a drop of 373 basis points from the previous trading day. It fell below the 7.00 than an hour after the opening, and closed at 7.0257.
  
  The World Bank expects China to grow by just 0.1–2.3%, the lowest growth rate in decades.
  
  On 22 May, Chinese Premier Li Keqiang announced that, for the first time in history, the central government wouldn't set an economic growth target for 2020, with the economy having contracted by 6.8% compared to 2019 and China facing an "unpredictable" time. However, the government also stated an intention to create 9 million new urban jobs until the end of 2020.
  
  In October 2020, it was announced that China's third-quarter GDP has grown with 4.9%, hereby missing analysts expectations (which was set at 5,2%). However, it does show that China's economy has indeed been steadily recovering from the coronavirus shock that caused decades-low growth. To fuel economic growth, the country set aside hundreds of billions of dollars for major infrastructure projects and used population tracking policies and enforced the stringent lockdown to contain the virus. It is the only major economy that is expected to grow in 2020, according to the International Monetary Fund.
  
  By December 2020, China's economic recovery was accelerating amid increasing demand for manufactured goods. The UK-based Centre for Economics and Business Research projected that China's "skilful management of the pandemic" would cause the Chinese economy to surpass the United States and become the world's largest economy by nominal GDP in 2028, five years sooner than previously expected.