Chinese lockdown unrest upends global economic outlook
Growing protests in the world's largest manufacturing nation add a new element of uncertainty to war in Ukraine, an energy crisis and the inflation.
Growing protests against tough pandemic restrictions in China - the world's second largest economy - are injecting a new element of uncertainty and instability into the world economy as nations already struggle to deal with the fallout from a war in Ukraine, an energy crisis and painful inflation.
For years, China served as a global factory and a vital engine of global growth, and unrest can only spread elsewhere. Analysts warn that more unrest could further slow the production and distribution of integrated circuits, machine parts, home appliances and more. It could also encourage companies in the United States and Europe to divest from China and diversify their supply chains more quickly.
Millions of Chinese citizens suffered under a strict lockdown for months. as the Communist Party seeks to stem the spread of the Covid-19 virus, three years after its appearance. Anger turned into widespread protest after an apartment fire last week killed 10 people and comments on social media questioned whether the lockdown had stopped their escape.
It's unclear whether protests erupted across the country will quickly be snuffed out or erupt into broader resistance to the iron rule of its supreme leader, Xi Jinping, but so far the damage the biggest economic hits come from the lockdown.
"The biggest economic hit comes from zero-Covid policies," said Carl Weinberg, chief economist at High Frequency Economics, a research company. "I don't see the protests themselves as a game changer."
"The world will always look to China for what it does best and what it does less dear," he added.
Asked how the Biden administration assessed the economic fallout from the latest unrest, John Kirby, strategic communications coordinator at the National Security Council, said Monday: I don't see any particular impact at this time on the supply chain. in world markets. The S&P 500 index closed down 1.5% as the dollar, often a safe haven in turbulent times, rose. Oil prices started the day with a sharp decline before rebounding.
The scale of China's economy and resources make it a key player in the World trade. "It's extremely central to the global economy," said Kerry Brown, a research associate in the Asia-Pacific program at Chatham House, an institute of international affairs in London. This uncertainty "will have a massive impact on the rest of the world".
China now overtakes all countries as the largest oil importer. It manufactured nearly 30% of the world's goods in 2021. "There is simply no alternative to what China offers in terms of scale and capabilities," Brown said.
>Pandemic-related delays and shortages have prompted many industries to re...
Growing protests in the world's largest manufacturing nation add a new element of uncertainty to war in Ukraine, an energy crisis and the inflation.
Growing protests against tough pandemic restrictions in China - the world's second largest economy - are injecting a new element of uncertainty and instability into the world economy as nations already struggle to deal with the fallout from a war in Ukraine, an energy crisis and painful inflation.
For years, China served as a global factory and a vital engine of global growth, and unrest can only spread elsewhere. Analysts warn that more unrest could further slow the production and distribution of integrated circuits, machine parts, home appliances and more. It could also encourage companies in the United States and Europe to divest from China and diversify their supply chains more quickly.
Millions of Chinese citizens suffered under a strict lockdown for months. as the Communist Party seeks to stem the spread of the Covid-19 virus, three years after its appearance. Anger turned into widespread protest after an apartment fire last week killed 10 people and comments on social media questioned whether the lockdown had stopped their escape.
It's unclear whether protests erupted across the country will quickly be snuffed out or erupt into broader resistance to the iron rule of its supreme leader, Xi Jinping, but so far the damage the biggest economic hits come from the lockdown.
"The biggest economic hit comes from zero-Covid policies," said Carl Weinberg, chief economist at High Frequency Economics, a research company. "I don't see the protests themselves as a game changer."
"The world will always look to China for what it does best and what it does less dear," he added.
Asked how the Biden administration assessed the economic fallout from the latest unrest, John Kirby, strategic communications coordinator at the National Security Council, said Monday: I don't see any particular impact at this time on the supply chain. in world markets. The S&P 500 index closed down 1.5% as the dollar, often a safe haven in turbulent times, rose. Oil prices started the day with a sharp decline before rebounding.
The scale of China's economy and resources make it a key player in the World trade. "It's extremely central to the global economy," said Kerry Brown, a research associate in the Asia-Pacific program at Chatham House, an institute of international affairs in London. This uncertainty "will have a massive impact on the rest of the world".
China now overtakes all countries as the largest oil importer. It manufactured nearly 30% of the world's goods in 2021. "There is simply no alternative to what China offers in terms of scale and capabilities," Brown said.
>Pandemic-related delays and shortages have prompted many industries to re...
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