(Yicai Global) April 26 -- A slew of Covid-19 outbreaks this year have had a big impact on regional economies in China. The economic powerhouses of Shanghai and Guangdong province were among five provincial-level regions that saw their economy grow slower than the mainland average of 4.8 percent in the first quarter and all were badly affected by new waves of the virus.

Henan, Jiangsu and Guangdong provinces as well as the municipalities of Shanghai and Tianjin logged the slowest growth in the country in the three months ended March 31 from a year earlier at 4.7 percent, 4.6 percent, 3.3 percent, 3.1 percent and 0.1 percent respectively, according to economic data released by 27 provincial-level regions as of yesterday.

Jiangxi, Hubei and Fujian provinces were the best performers with growth rates of 6.9 percent, 6.7 percent and 6.7 percent, respectively. Provinces with abundant energy resources were better able to offset the impact of the virus. Shanxi province, a major coal producer, saw its GDP jump 6.5 percent to rank fifth.

The Covid-19 outbreaks badly affected the economy in the first quarter, hitting the service sector the hardest, said Zeng Junlin, chief economist at the Sichuan Provincial Bureau of Statistics. Chengdu, the capital of southwestern Sichuan province, was struck by two waves of the coronavirus in the first three months.

Sichuan’s service sector expanded 4.8 percent in the first quarter, 2.1 percentage points below the average of the past two years, Zeng said. The province’s GDP growth was 5.3 percent for the period, falling below 6 percent, the average of the previous two years.

China must achieve a balance between implementing pandemic control measures and allowing normal life and work to continue, Yi said. It needs to fight the pandemic in more scientific ways. Policies must focus on how to enhance spending power, he added.

The country must provide more targeted support to stabilize production, safeguard supply chains and stabilize prices to help companies receive orders and keep operating, Zeng said.

Weaker Spending Power

Total retail sales of consumer goods in most provinces grew at a pace slower than 5 percent and some were even below 3 percent. As the contribution of consumption to GDP growth has been on the increase in recent years, the decline in spending is having a big impact on the economy.

The island province of Hainan saw its retail sales of goods plunge 17.8 percent from a year ago as tourists stayed away, said Lin Jingyun, director of the Department of Trade, Foreign Trade and Tourism under Hainan Provincial Bureau of Statistics.

Editor: Kim Taylor