Beijing, Shanghai and Guangdong are doing well; Tibet, Xinjiang, Gansu and Qinghai are not. According to the China Beige Book, Chinese authorities are lying. Small and medium-sized enterprises continue to struggle. Protests flare up in the construction industry.
Beijing (AsiaNews) – China’s economy is running at two speeds. Big industrial groups based on the coast are accelerating the post-COVID-19 recovery. The same cannot be said for inland businesses, this according to a study by the China Beige Book, an independent research firm.
Chinese authorities are lying about the economic recovery. Beijing is using the recent positive data to develop a narrative of success in fighting the coronavirus pandemic, and show itself as the first country to get back on track after the first wave of the pulmonary disease.
Official data show that the economy grew by 3.2 per cent in the second quarter of 2020 over last year, after a 6.8 per cent slump between January and March.
For analysts, China's GDP could grow by 5 per cent in the third quarter. But according to the China Beige Book, a survey of 3,300 companies indicates two economic realities in the country.
The industrial areas of Beijing, Shanghai and Guangdong are recovering at great speed, whilst the rest of the country is struggling.
Output in the inland provinces will not recover between the second and third quarter of this year. Businesses in Tibet, Xinjiang, Gansu and Qinghai could see a drastic drop in activity.
The gap between coastal and the inland provinces is evinced by the differences in the volume of borrowing: in coastal areas it is 2-3 times higher than inland, this according to 160 bankers interviewed by the China Beige Book.
The contradictions of China’s economic recovery emerge in other areas as well. The consulting giant Nomura reports that the travel industry is still affected by the drop in the number of people moving around the country.
Whilst big companies show signs of a rapid recovery, small and medium-sized enterprises continue to suffer. Since January, catering has seen a 28.6 per cent drop in earnings, box office revenues are down by 48.6.
Construction is another sector in serious crisis. According to the Hong Kong-based China Labour Bulletin, the number of construction worker protests has grown exponentially in the last four months: 151 between May and August, up from 39 between January and April.
Nearly all are related to wage arrears. Construction companies are unable to pay because of declining activities and lower revenues.