Latest news indicates that China’s zero-Covid strategy is taking a toll on the economy.
Citing data from China’s Finance Ministry, Nikkei reported that its land revenue dropped 38% year-on-year in April. This is the largest decrease in over six and a half years.
Housing sales also fell more than 40% year-on-year in April.
The strict Covid lockdowns are dampening China’s economic activity. As a result, it has further squeezed the country’s real estate sector. This sector has already been stumbled from the government’s regulatory crackdowns to tame a bubble.
Many property developers are believed to defer new projects following the downturn in the market.
China just released its official April data on Monday, showing a grim economic outlook, reflecting that Covid-fighting measures have hit the economy harder than expected.
Retail and manufacturing sectors witnessed a decline in April, with retail down 11.1%, much below the 6.1% decrease forecast from a Reuters survey. Industrial production also decreased 2.9% year-on-year, down from a 5% gain in March. The unemployment rate reached the highest of 6.1% since the initial coronavirus outbreak, when the rate was at 6.2% in January 2020.
In terms of unemployment, according to Bloomberg, Premier Li Keqiang warned earlier this month that China’s employment situation is “complicated and grave” as Beijing and Shanghai tighten curbs on residents in the country’s most important cities.
Li Keqiang ordered all government departments and regions to take measures to help businesses retain jobs and overcome the current difficulties.