China’s retail sales plunged last month, official data showed yesterday, as COVID restrictions and a property market crisis hammered the world’s second-largest economy.
The figures highlight the work ahead for the government as it moves away from almost three years of strict containment measures that have whittled growth and sent shudders through supply chains.
November retail sales sank 5.9 percent on-year, marking the second successive contraction, according to data released by the National Bureau of Statistics (NBS).
The figure was also much worse than the four percent shrinkage forecast in a survey by Bloomberg News.
The data also showed industrial production grew 2.2 percent on-year last month, less than half October’s rate, while unemployment rose 0.1 percentage point to 5.6 percent.
China was the last major economy persisting with a zero-COVID strategy through harsh lockdowns and mass testing, with authorities effectively abandoning the policy only last week after suffering an economic slowdown and mounting public anger.
November saw some of the highest infection numbers ever recorded in China, with as much as a quarter of the population under some form of lockdown by the end of the month, according to analysts’ estimates.
“In November, local outbreaks spread to most provinces across the country, residents’ travel decreased and consumption scenarios were restricted,” NBS statistician Fu Jiaqi said in a statement.
“The sales of non-essential goods and gathering-based consumption were significantly affected,” Fu said.
Chinese leaders have set an annual economic growth target of about 5.5 percent,but many observers think the country will struggle to hit it, despite announcing a better-than-expected 3.9 percent expansion in the third quarter.
A crisis rippling through China’s massive property sector has also weighed on the economy, with developers defaulting on loans and struggling to raise cash after Beijing imposed widespread lending curbs in 2020.