China’s political and economic systems may be vastly different from many countries globally, but the way authorities restart the Chinese economy following the coronavirus outbreak offers some “useful lessons” for other economies, a Goldman Sachs economist said on Monday.
The coronavirus was first discovered in the Chinese city of Wuhan before spreading to the rest of the country and all over the world. That makes China the first country to be affected by the pandemic — and it appeared to be among the first to contain the virus spread, as far as official data showed.
China started lifting lockdown measures on Wuhan — the epicenter of its outbreak — last month when new cases were still surging in many countries. But China’s experience so far showed that a full economic recovery will take time, said Andrew Tilton, chief Asia economist at Goldman Sachs.
“I think there are useful lessons there,” he told CNBC’s “Street Signs Asia.”
“I think the industrial sector probably comes back before the services side — I think that’s one thing we can probably imagine and see in other places. It’s easier to bring the supply side back there,” he said.
Tilton added that countries would see a strong recovery when restrictions are first lifted because some companies could resume normal operations quickly. But others, such as those in the tourism sector, may take longer to restart activity, he said.
In China, policymakers appeared cautious about allowing businesses such as movie theaters and gyms to reopen, the economist noted. That means that there’s still some way to go before the country returns to a situation that’s close to “normal” — in other countries, that would not happen until 2021, said Tilton.
Many countries around the world implemented lockdown measures of varying degrees to curb the spread of the coronavirus. Those restrictions — which include closing borders and shutting nonessential workplaces — halted much of global economic activity.
Over the last few weeks, several countries started to relax some of those measures. But epidemiologists and public health experts warned that rolling back those measures too quickly could result in another outbreak of the coronavirus disease Covid-19.