China Is a Lone, Feeble Dove in a World of Hawks

China Is a Lone, Feeble Dove in a World of Hawks

International and Arab News

The qualifiers keep coming for the global recovery. Cuts to growth projections arrive almost weekly and recession warnings are starting to multiply. A slump isn’t yet the base case, but it sure would be nice if China could lend a hand.

That doesn’t look likely. While China’s gross domestic product rose more than forecast in the first quarter, up 4.8%, the collapse in consumer spending during March suggests lockdowns in Shanghai and other major cities will extract a large toll. Data also show investment slowed and unemployment climbed. Traditionally, a cushion for challenging times in the US and Europe, China is in Covid-19 purgatory.

This doesn’t have to be fatal for the global economy; China shifting to a more sustainable level of growth has long been desired, in Beijing and abroad. Yet pursuit of a Covid-zero policy appears unattainable. Most countries are now “living with Covid,” which amounts to a squishy detente.

Another warning sign is that China hasn’t flooded the economy with stimulus, indicating this pandemic limbo could last a while. The central bank balked at reducing a key interest rate Friday, surprising analysts, and made only a quarter-point reduction in the amount of reserves banks are required to