Coronavirus could cost China US$417 billion in 2021, researchers say

‘International price shocks’ likely to be biggest threat to nation’s GDP, but 8 per cent year-on-year growth still possible, according to study by Chinese and American teams

Coal, ore, metal, electricity, gas and food producers expected to see the value of their output fall by between 2.8 and 5.4 per cent, paper says

Reading Time:2 minutes

China’s metal producers are among those likely to see their profits slide in 2021, according to a new study. Photo: AFP

Published: 3:23pm, 2 Mar 2021Updated: 4:40pm, 2 Mar 2021

The coronavirus pandemic could cost China the equivalent of 2.7 per cent of its gross domestic product this year, although the economy may still grow by over 8 per cent, according to a new study by Chinese and American researchers.

The industrial and processing sectors are likely to bear the brunt of the impact, with coal, ore, metal, electricity, gas and food producers expected to see the value of their output fall by between 2.8 and 5.4 per cent, said the team from the Chinese Academy of Sciences’ Centre for Forecasting Science and the University of Kansas.

Sectors and companies that were closely linked to the global economy would be the worst affected, the researchers said in a peer-reviewed paper published in China Economic Review on Saturday.

They forecast the total cost of the pandemic to China in 2021 at between 1.2 and 2.7 per cent of GDP. Based on the value of its economy in 2020 – 101.6 trillion yuan (US$15.7 trillion) – that would represent between 1.2 trillion and 2.7 trillion yuan.

Despite the expected hit to GDP, China’s economy could still grow by more than 8 per cent this year, the researchers said. Photo: Xinhua

Despite the potential costs of the health crisis, the country was still well placed to record strong economic growth this year, the study said.

“China’s economy could achieve growth of up to 8.1 per cent in 2021,” it said.

Select Voice

Choose your listening speed

Get through articles 2x faster

1.25x

250 WPM

Slow

Average

Fast

00:0000:00

1.25x