China's economy bounced back to growth in the second quarter (Q2) of the year, leaving the world's second-largest economy away from a recession even as some countries struggle with the COVID-19 impact, The Wall Street Journal (WSJ) said on Thursday.
Earlier on Thursday, China reported its economy growth at 3.2 percent year on year in Q2.
"Chinese exports in particular have been a bright spot, even as the rest of the world struggles with the pandemic. Because China had its factories up and running before other exporting nations, Chinese businesses were able to fill gaps in global supply and expand its share of global exports," said WSJ in its report entitled "China's Economy Appears Back on Track, but Challenges Remain."
For foreign companies with operations inside and outside of China, the contrast has been striking, it said.
WD-40 Co., the San Diego-based maker of the namesake lubricant, said its China sales in the most recent quarter rose 26 percent from a year earlier while total world-wide sales tumbled 14 percent, according to the WSJ report.
The paper quoted Anders Nystrom, CEO of Bulten AB, a Swedish supplier of automotive fasteners, as telling investors last week that production volumes at its China factories "are now essentially back to pre-pandemic levels," even as its U.S. and European plants struggle to come back online after coming to a virtual standstill at the beginning of the quarter.
However, the paper said the biggest risk to China's economic outlook could be the United States "where senior officials and lawmakers from both major parties are ramping up rhetoric against China and imposing sanctions targeting Chinese entities ahead of November's presidential election."
Lian Ping, chief economist at Zhixin Investment Research Institute, lists external pressures and the U.S. economy as the biggest challenges to China's recovery during the second half of the year.
"The stability of the U.S. economy leaves a big question mark over China's exports," Lian was quoted as saying. Enditem