China, from epicenter of the pandemic to the only winner of 2020 in the global economy

As every year, Modaes.es carries out in the last weeks of December a review of the last twelve months in the fashion business, marked by the impact of the Covid-19 pandemic. Macroeconomic analysis of Spain and the world, a tour of the social phenomena that the coronavirus has caused and reports on the impact on the main companies in the sector make up the 2020 Special: the fashion business in the year of Covid-19.

2020 Special: The Fashion Business
in the year of Covid-19

China has been in 2020 the advantageous student in the fight against the pandemic and, despite being the country of origin of Covid-19 and the evidence that it tried to hide it from the international community, it comes out of the global crisis caused by the disease. The country was the first to undertake restrictive measures against the spread of the epidemic and it demonstrated the effectiveness of its social and political culture, with a level of trust and obedience in the authorities unknown in the West.

In April, while in Europe the strictest confinement measures were put in place due to the rise in infections, Wuhan hospitals were cleared of coronavirus cases and the vast majority of the main industrial companies in the country had restarted their activity.

China’s Gross Domestic Product (GDP) decreased 9.8% compared to the previous period in the first quarter, but in the second it already registered a double-digit growth of 11.5%. Chinese industry activity also experienced a fleeting moment of weakness, when in February the PMI for the manufacturing sector fell to 35.7 points, only to pick up pace immediately thereafter to even above fifty points.

China will be one of the only countries to close 2020 positively, according to the International Monetary Fund

Likewise, China managed to increase its exports in 2020 despite the abrupt slowdown in the international economy (the World Trade Organization estimated a 9.2% drop in world trade in goods in 2020). In November, exports in dollars from the Asian giant grew by 21.1% compared to the same month of the previous year, chaining six consecutive months of increases. From January to November, cumulative exports rose 2.5%.

According to the International Monetary Fund (IMF), China, whose “rapid recovery has surprised to the upside”, will be one of the only countries to close 2020 in positive, with a GDP growth of 1.9% (compared to 5.1% the previous year) that will accelerate to 8.2% in 2021.

In 2020 China has also prepared its fourteenth five-year plan, which will be in force from 2021 to 2025 and which, for the first time, will not include an economic growth objective in terms of rising GDP. The central committee of the Chinese Communist Party (CCP), led by President Xi Jinping, has also promoted an unprecedented roadmap of economic and political development for the next fifteen years. Technology, environment and defense against external threats are some of the axes of this plan, in which the impulse of the middle classes in the most populous country in the world has a particular relevance.

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