Goldman slashes China growth forecast

BEIJING/SHANGHAI: Goldman Sachs said on Tuesday that China’s economy will likely shrink 9 per cent in the first quarter, underscoring how the coronavirus has disrupted normal business activities, even as China reported a rise in new cases of the disease, most of them imported.
Goldman cut its estimate for China’s first-quarter gross domestic product growth to a 9 per cent contraction, from a previous forecast of 2.5 per cent growth, citing “strikingly weak” economic data in January and February. It also lowered its full-year GDP forecast to 3 per cent growth from an earlier estimate of 5.5 per cent.
The sharp cut in the bank’s forecasts come as imported cases of coronavirus in China outnumbered cases of local transmission for a fourth straight day.
The rising risk of imported cases has prompted some parts of the country to tighten monitoring of foreign travellers, and the Chinese foreign ministry on Tuesday advised its citizens to avoid travel to high-risk countries.
Mainland China had 21 new confirmed cases on Monday, the National Health Commission said, up from 16 a day earlier. Of the new cases, 20 involved infected travellers from abroad.
Raising further concerns about spread of the disease, a man recently returned from Spain has tested positive for the virus — despite showing no symptoms —and has been put under observation and into quarantine, according to a statement on the website of the city of Mianyang, Sichuan.
An additional 25 passengers who had shared a flight with the man and two of his family members have also been subject to quarantine, the statement said.
In contrast to the growing number of imported cases, mainland China had only one case of locally transmitted infection on Monday, in Wuhan, capital of central Hubei province where the flu-like disease appeared in humans late last year.
The capital Beijing accounted for nine of the imported new cases even as it imposed tough restrictions to screen out and isolate infections coming from abroad. — Reuters