World The Delta variant in China is just one of the clouds hanging over the economy
President Xi Jinping turns his fire on China's rich in push to redistribute wealth
Chinese President Xi Jinping this week issued a bold new pledge to redistribute wealth in the country, piling more pressure on the country's richest citizens and businesses. Xi told top leaders from the ruling Chinese Communist Party on Tuesday that the government must establish a system to redistribute wealth in the interest of "social fairness," according to a summary of the speech published by Xinhua, the official state news agency. He said it was "necessary" to "reasonably regulate excessively high incomes, and encourage high-income people and enterprises to return more to society.
China'sis slowing down — and it's not just the spread of the of Covid-19 that has economists and government officials on alert.
Chinese officials on Monday released new data on industrial production, investment and retail sales for July showing signs of weakness in the economy. Growth in industrial production was the slowest it has been in 11 months, rising by 6.4% from a year ago. Car production was slammed by the global shortage of semiconductors.
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While no vaccine offers bulletproof protection, the coronavirus vaccines have proved to be effective in limiting the spread of COVID-19. Breakthrough infections are possible, but they make up a small portion of total coronavirus cases, hospitalizations and deaths. Public health data shows the bulk of COVID-19 cases are among unvaccinated individuals. Fact check: 6 of the most persistent misconceptions about COVID-19 vaccines Social media platforms have removed versions of the video for violating rules against coronavirus misinformation. But as of Aug.
Growth in retail sales in July was the weakest it has been all year, while investment in fixed assets also missed economists' expectations.
"Theand have affected the economy in some regions, and the economic recovery is still unstable and uneven," said Fu Linghui, a spokesman for the National Bureau of Statistics (NBS), at a press conference in Beijing on Monday. Along with the latest coronavirus outbreak, catastrophic flooding swept through central China last month, . Widespread damage and disruption has also caused direct economic losses totaling nearly $21 billion, according to government statistics released this month.
The flareup of Covid-19 likely contributed to at least some of the slowdown in retail sales toward the end of July, according to Julian Evans-Pritchard, senior China economist for Capital Economics.
China's zero-Covid policy: An infected 4-year-old separated from his parents highlights its human cost
Covered from head to toe in a white hazmat suit, a small child carrying a backpack half the size of his body toddles down a hospital corridor and arrives at a CT scan room -- all by himself. © From Sohu.com "A 4-year-old boy has been infected (with Covid-19), unfortunately," a caption in the video reads. "No accompanying parents. Going to quarantine alone."The scene, captured by a nurse at a quarantine hospital in the city of Putian, the epicenter of China's latest Delta variant outbreak, gripped millions of people when it went viral on Chinese social media this week.
The outbreak in China has spread to more than half of the country's 34 provinces and regions, and led to more than a thousand confirmed cases. Authorities have takento stamp out new infections, including isolating cities, canceling flights and closing down entertainment venues.
The unemployment rate for young people worsened in July to 16.2%, according to government data. That's the highest rate in a year.
The virus outbreak, along with disruptions caused by severe flooding in central China, "appears to have disrupted the hiring of fresh graduates somewhat," Evans-Pritchard added in a Monday research note.
Fu of the NBS said a few factors are contributing to pressure on the labor market. More than 9 million new college graduates are seeking jobs in China this year. And because of the pandemic, many students who were studying overseas have returned home to look for work.
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Persistent supply bottlenecks and tighter credit conditions have exacerbated concerns about economic growth. Infrastructure spending was especially weak as authorities withdrew fiscal support.
"Tighter restrictions on borrowing among developers appear to be taking some of the heat out of property investment," Evans-Pritchard added.
Car manufacturing was the worst performer among major industrial sectors, contracting 8.5% in July compared to a year earlier. That was mainly because of the ongoing chip shortage, according to Iris Pang, chief economist for Greater China at ING.
Production of computers, telecommunications equipment and other electronic products are also likely to slow down in the coming months because of the chip supply issues, Pang added.
There are more challenges ahead for the Chinese economy. Last week, authorities shut down a terminal in Ningbo-Zhoushan port — the world's third largest container port — after a dock worker tested positive for Covid. The port handles goods that would fill around 78,000 20-foot containers every day, and the terminal that closed accounts for around a fifth of the port's volume.
"This will negatively affect import and export activity around the area of Shanghai," she said. "We expect terminal congestion might take several months to clear."
on tech, education and other sectors could also "curtail the growth" for tech firms in the short term, Pang added.
Evans-Pritchard, meanwhile, said he expected spending to pick back up as the virus is brought back under control and restrictions are lifted in China.
But he anticipated the slowdown elsewhere to deepen, as the People's Bank of China is likely going to continue keeping credit growth in check.
China Unveils Homegrown Warplanes, Combat Drones and Space Tech at Air Show .
The highly watched 13th Zhuhai Airshow kicked off on Tuesday with the unveiling of new military drones and a modified strike fighter for electronic warfare.The biennial China International Aviation and Aerospace Exhibition in Guangdong province—also known as the Zhuhai Airshow—is the largest of its kind in the country and takes place following an unusual three-year gap due to the pandemic. Remaining public health measures mean the number of foreign visits were also scaled down for the 13th edition, which is taking place between September 28 and October 3.