SupChina illustration by Derek Zheng
The COVID-19 pandemic has done serious damage to China’s economy. Some of the pain is already evident in the numbers:
Popular business writer Wú Xiǎobō 吴晓波 detailed (in Chinese) in a recent report that about 247,000 Chinese companies declared bankruptcy in the first two months of 2020:
Guangdong was the most impacted province, according to Wu, with over 30,000 firms going out of business in January and February, followed by Shandong, Jiangsu, Sichuan, and Zhejiang. Roughly 55% of bankrupt businesses nationwide were startups under three years old.
Other surveys suggest similar pain, especially among small businesses. Almost 36% of the privately owned firms that responded to a survey conducted by Tsinghua University in February said that they were hammered by the economic fallout from the outbreak and did not expect to survive after a month. In another survey released in February, more than 60% of the small and medium-sized enterprises in Shandong said that they could only hold out for a maximum of three months under current conditions.
However, some businesses have been thriving in the crisis. According to business data platform Tianyancha (in Chinese), since February, more than 28,000 companies across China have expanded their scope to include healthcare-related services and the manufacture of medical equipment such as thermometers and masks. Internet-based firms have also seized the opportunity to grow as people face a new reality in which online classes and virtual meetings have become the norm.