BEIJING (Reuters) – China’s economy returned to growth in the second quarter after a deep slump at the start of the year, but unexpected weakness in domestic consumption underscored the need for more policy support to bolster the recovery after the shock of the coronavirus crisis.
Asian share markets and the Chinese yuan CNY=CFXS fell, partly reflecting the broad challenges facing the world’s second-largest economy as it grapples with the double-whammy of the pandemic and heightened tensions with the United States over trade, technology and geopolitics.
Gross domestic product (GDP) rose 3.2% in the second-quarter from a year earlier, the National Bureau of Statistics said on Thursday, faster than the 2.5% forecast by analysts in a Reuters poll, as lockdown measures ended and policymakers ramped up stimulus to combat the virus-led downturn.
The bounce was still the weakest expansion on record, and followed a steep 6.8% slump in the first quarter, the worst downturn since at least the early 1990s.
“As we previously highlighted, policy support is still needed despite recovering growth momentum,” Betty Wang, ANZ bank’s senior China economist.
“The possibility of resurgences in local COVID-19 cases, global economic uncertainty and the deteriorating China-U.S. relationship all pose downside risks to China’s H2 growth outlook,” Wang said.
Those risks were partly reflected in separate retail data that showed Chinese consumers kept their wallets tightly shut, pointing to a bumpy outlook at home and overseas, as many countries continue to grapple with the COVID-19 pandemic – led by surging infections in the United States.
Though June indicators and GDP numbers largely beat expectations, Rodrigo Catril, a foreign exchange strategist at NAB in Sydney, said they also revealed “the China consumer remains behind in terms of the recovery story.”
“It’s very much a story of government stimulus-led recovery, which is very much focused on the industrial side. The consumer remains very cautious. That cautiousness is something the market is looking at in terms of countries where the consumer plays a bigger role, so that’s obviously relevant for the U.S. as well.”
Retail sales were down 1.8% on-year in June – the fifth straight month of decline and much worse than a predicted 0.3% growth, after a 2.8% drop in May.
Domestic job losses have been one of the worries for consumers, as many businesses struggled to stay in the black.
Wanda Film, for example, China’s largest cinema chain operator which has more than 600 cinemas, on Tuesday warned of a first half net loss of 1.5-1.6 billion yuan ($214-228 million), after the coronavirus kept its cinemas shut for almost the entire period.
U.S. tensions, structural issues
In the first half of the year, the economy contracted 1.6% from a year earlier, underscoring the sweeping impact of the virus which first emerged in China late last year and has killed over 583,000 people worldwide.
The rising tensions with the United States and the pandemic have added to structural issues that China has been facing for years, including demographic changes, over-investment, low industrial productivity and high debt levels.
On a quarter-on-quarter basis, GDP jumped 11.5% in April-June, the NBS said, compared with expectations for a 9.6% rise and a 10% decline in the previous quarter.
The government is expected to offer more support on top of a raft of measures already announced, including fiscal spending boost, tax relief and cuts in lending rates and banks’ reserve requirements.
But debt worries have kept a leash on China’s stimulus tap. Net fiscal stimulus unveiled so this year amounted to just over 4 trillion yuan ($571.76 billion), much restrained compared the spending burst in other major economies including the United States and Japan.
The Institute of International Finance estimates China’s total debt rose to 317% of gross domestic product in the first quarter of 2020, up from 300% in late 2019 and the largest quarterly increase on record.
The industrial economy offered some hope for the nation as it tries to regain its footing, with output in the vast sector rising 4.8% in June from a year earlier, the third straight month of growth, the data showed, quickening from a 4.4% rise in May.
Fixed asset investment fell a less-than-expected 3.1% in the first half from the same period in 2019, moderating from a 6.3% decline in the first five months, while real estate investment growth also quickened to 8.5% in June, thanks to the credit boost.
While the International Monetary Fund has forecast China to expand 1.0% for the full year, the only major economy expected to report growth in 2020, many analysts caution about the outlook.
“Domestic demand will drive China’s recovery ahead, but external demand could be a risk to the growth outlook given the possibility of large second round of coronavirus infections overseas,” said Oshimasa Maruyama, chief market economist at SMBC Nikko Securities in Tokyo.
Reporting and photo: Reuters
Atmosphere Core expands in South Asia with Atmosphere Living ultra-luxury residences
Atmosphere Core, a globally renowned name in hospitality, has announced the launch of Atmosphere Living as part of its continued expansion in South Asia. Headquartered in India, this new company will offer branded ultra-luxury residences with customised end-to-end amenities and indulgences, including coffee lounges, wine cellars, private transport, and bespoke concierge services.
The global branded residences market has experienced a remarkable 150 percent growth over the past decade, and projections indicate a surge in demand. With the real estate veteran Sandeep Ahuja at the helm as Managing Director, Atmosphere Living is strategically positioned to capitaliSe on this demand.
Atmosphere Living will focus on a conscious design philosophy. All properties will be built in harmony with the environment and will incorporate features such as smart recycling, efficient waste and water management, and green energy solutions.
Sharing his insights on the launch, Salil Panigrahi, Managing Director, Atmosphere Core, said, “Atmosphere Living will bring a distinctive offering to India, and is a brand to watch out for. It will combine Ahuja’s decades of experience, knowledge, and industry network in real estate with Atmosphere’s hospitality expertise, introducing unparalleled serviced residences in India.”
Positioned in major metropolitan areas, established second-home destinations, and undiscovered scenic locales nationwide, these projects will also present lucrative investment opportunities. Elite homeowners will have the option to lease their residences back to Atmosphere Living, allowing them to be rented out for income generation.
Sandeep Ahuja, Managing Director, Atmosphere Living, said, “There is currently a gap in the Indian realty landscape for ultra-indulgent serviced homes catering to affluent consumers. We aim to bridge this gap by curating serviced homes that offer indulgences such as entering homes using smart key cards, 24/7 butler services, fine dining, and co-working spaces, among others. Our ultimate desire is to enable our customers to experience a life of true luxury and exclusivity.”
A night of celestial wonders, luxury, and cosmic inspiration at Anantara Kihavah SKY Observatory by British astronaut Tim Peake
Anantara Kihavah Maldives Villas celebrated a historic milestone with the exclusive visit of the renowned British astronaut, Tim Peake. On the evening of November 2, Astronaut Peake hosted an exclusive space talk at SKY Observatory, the finest overwater observatory in the Indian Ocean, housing the most powerful telescope in the Maldives.
Perched gracefully over the pristine Maldivian waters, SKY Observatory provided an idyllic setting for this extraordinary event, complemented by a stunning sunset. The exclusive gathering attracted a full house of eager guests to a delightful evening that seamlessly blended science, luxury, and natural beauty.
The evening commenced with a lovely cocktail reception, where guests were serenaded by the soulful tunes of a live saxophone band. Attendees savoured exquisite cocktails and canapés as they eagerly awaited Tim Peake’s presentation.
Tim Peake’s talk unveiled his personal journey, where he shared his path to becoming an astronaut and narrated the rigorous training that astronauts undergo. He provided insights into life in space, the daily challenges faced by astronauts, and the awe-inspiring experiences he encountered during his
historic mission. He also offered a glimpse into his exciting future projects, leaving the audience both inspired and spellbound.
Following Tim’s presentation, an interactive Q&A session allowed guests to engage directly with the British astronaut. The audience posed thoughtful questions, deepening their understanding of astronauts’ unique experiences and the intricacies of space exploration.
The event was further enriched by the presence of the resort’s three SKY gurus, Hammadh Rasheed, Zunnoon Ahmed, and Ali Arushal, who conducted a stargazing session for the guests afterward.
The success of the event was evident in the overwhelmingly positive feedback from attendees, who left with a deeper appreciation for space exploration and a memorable evening to cherish.
The evening marked a significant moment in Anantara Kihavah’s history, showcasing the resort’s commitment to offering unique and memorable experiences for its guests. The presence of Tim Peake, a celebrated astronaut and highly accomplished author, added an extraordinary dimension to the resort’s already spectacular offerings.
Tim Peake is a renowned British astronaut who made history as the first official British astronaut to visit the International Space Station (ISS) and conduct a spacewalk during his six-month mission. He also achieved the remarkable feat of running the London Marathon from space. Beyond his extraordinary space endeavours, Tim is also a bestselling author with his most recent book Space: A thrilling human history published earlier this month.
An astronomer’s paradise, Baa Atoll in the Maldives, is one of the best places on earth to enjoy stargazing due to its proximity to the equator. Anantara Kihavah Maldives Villas promises a voyage of discovery on a private Indian Ocean Island, with Sky—an overwater observatory and luxury cocktail bar—providing guests a chance to sip champagne under the stars and explore the Universe.
Visit Maldives website adds atolls segment to showcase diverse regions
Maldives Marketing and Public Relations Corporation’s (MMPRC/ Visit Maldives) has added a new segment to the official Visit Maldives Website specified for atolls showcasing the diversity of the Maldives.
The segment, now live at atolls.visitmaldives.com provides in depth information regarding the different regions of the Maldives, divided by atolls, to refine the traveller’s experience, commencing with an in-depth exploration of Addu Atoll and Fuvahmulah Atoll.
With 26 atolls, the Maldives offers a wide array of unique accommodations and awe-inspiring travel experiences, and this informative section of our website will serve as a gateway to discover the hidden treasures unique to each area. This falls under MMPRC’s initiatives to encourage tourism growth in all regions of the Maldives, broadening exposure to the diverse tourism products available in the Maldives.
The goal is to elevate Visit Maldives’ digital marketing landscape by showcasing the Maldives as more than just a honeymoon destination with various accommodation options. This initiative is driven by a desire to increase awareness about the distinctive offerings within each of the Maldives’ atolls. It aims to positively shape their perception of the Sunny Side of Life brand by curating engaging content that highlights the unique features of the atolls and diverse experiences available in the islands.
Additionally, the initiative will target the affordable luxury market to promote the Maldives as the most appealing option for short holidays and weekend getaways under a unified Maldives brand umbrella.
MMPRC aims to continue exploring other atolls in the Maldives as well, encouraging growth and tourism development in all regions of the Maldives, building on the foundation we have created to promote the destination beyond the traditional paradigms of sun, sand, and sea.
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