The geoeconomic impact of China’s COVID policy and why it matters to the EU

The COVID pandemic hit China in January 2020. Since then, like the rest of the world, the Chinese economy has gone through huge up and downs. The difference is that China appeared to have recovered from COVID earlier than anybody else, ending 2020 with positive GDP growth (2.3%), while deep recessions were being suffered globally. In fact, China was dubbed “first in, first out”. 

The problems began in the second half of 2021, as China’s recovery turned out to be less spectacular than many expected, and only worsened in the first half of this year, as it continued with draconian lockdowns and closed borders while the rest of the world finalised its opening up. In fact, China might end 2022 with below 3% GDP growth, well below the levels in Southeast Asia and less than half India’s rate.