**China’s economy contracted for the first time in decades in the first quarter of 2020, as the coronavirus pandemic paralyzed businesses and disrupted supply chains.**
**The National Bureau of Statistics reported Tuesday that gross domestic product (GDP) declined by 6.8% year-on-year in the January-March period.** This is the sharpest quarterly contraction on record and the first since 1976, when China began publishing quarterly GDP data.
**The pandemic has had a devastating impact on the Chinese economy.** The government imposed strict lockdown measures in late January to contain the virus, which led to the closure of factories, shops, and businesses. This caused a sharp decline in economic activity and a surge in unemployment.
**The service sector was particularly hard hit, with output falling by 10.5% year-on-year in the first quarter.** The manufacturing sector also contracted, with output falling by 3.1%.
**The pandemic has also disrupted global supply chains, which has led to a decline in exports and a slowdown in investment.**
**The Chinese government has taken a number of steps to support the economy, including cutting interest rates, providing loans to businesses, and increasing spending on infrastructure projects.** However, it is unclear how quickly the economy will recover from the pandemic.
**Some economists believe that the Chinese economy could rebound in the second half of 2020, as the pandemic is brought under control and businesses reopen.** However, others are more pessimistic, warning that the global recession could continue to weigh on the Chinese economy.
**The contraction in China’s economy is a major concern for the global economy.** China is the world’s second-largest economy and a major driver of global growth. The slowdown in China could have a ripple effect on other countries, particularly those that rely on exports to China.
**The IMF has warned that the global economy could shrink by 3% in 2020, the worst recession since the Great Depression.** The IMF also warned that the recession could be even deeper if the pandemic is not brought under control quickly.
**The Chinese government is facing a difficult task in trying to balance the need to contain the pandemic with the need to support the economy.** If the government is successful in containing the pandemic quickly, the economy could rebound in the second half of the year. However, if the pandemic continues to spread, the economic consequences could be severe..
