Retail sales in China fell by double digits last month, as the world’s largest economy fell to a two-year low in value terms for retail revenue, on the back of Beijing’s zero-Covid policy which has seen prolonged lockdowns, crushing the economy.
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Chinese retail sales plunged 11.1 percent year-on-year to CNY 2.95 trillion (USD 433.9 billion) in April, according to the National Bureau of Statistics (NBS). The decrease was more than the 6.1 percent decline predicted in a Reuters poll.
“In April, the epidemic had a big impact on economic operations,” NBS spokesman Fu Linghui told reporters, adding that the outbreak had a “significantly larger-than-expected” effect.
According to NBS data, the figure is the weakest since early 2020, and down from 5 percent growth in March.
The “increasingly grim and complex international environment and greater shock of [the] Covid-19 pandemic at home obviously exceeded expectation, new downward pressure on the economy continued to grow,” NBS said in a statement, adding that the impact of Covid is temporary and that the economy “is expected to stabilize and recover.”
By category, catering sales plunged by 22.7 percent, as restaurants in Shanghai were essentially closed in April, with Beijing locking down in early May.
As for the other categories, beverages, medicine, food and petroleum products saw year-on-year growth.
In addition to retail sales, industrial production growth fell 2.9 percent on-year, on the back of shuttered factories and transportation issues, as officials ramped up Covid restrictions last month, while manufacturing fell by 4.6 percent, dragged down by a slump in the auto sector and equipment manufacturing.
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From January to April, retail sales in China dropped 0.2 percent year-on-year to CNY 13.81 trillion (USD 2.05 trillion). Online sales increased 3.3 percent during the period, online sales of physical goods reached CNY 3.29 trillion (USD 487.4 billion), accounting for 23.8 percent of total retail sales.