China Intends to Beat U.S. in GDP Growth Despite Zero-COVID Policy

Chinese President Xi Jinping has told officials to ensure that the country’s economic growth outpaces that of the U.S. this year, despite the negative economic impacts of China’s zero-tolerance approach to COVID-19.

In response to Xi’s call to accelerate growth, Chinese government agencies are discussing plans to ramp up big construction projects, especially in the manufacturing, technology, energy, and food sectors, as well as to issue coupons to individuals to spur consumer spending, the Wall Street Journal reports.

The U.S. economy outpaced China’s economy in the fourth quarter of 2021, growing 5.5% year-on-year compared with China’s 4.0%. It was the first time in 20 years that the U.S. economy grew faster than the Chinese economy, according to the Wall Street Journal. 

Investors can gain exposure to the growth in China’s economy with the SmartETFs Asia Pacific Dividend Builder ETF (ADIV), which offers exposure to high-quality companies domiciled in China, Taiwan, Hong Kong, Australia, Singapore, the U.S., South Korea, Thailand, Malaysia, and India, according to ETF Database.

ADIV has earned the Morningstar Quantitative Rating of Gold due to strengths including its sizable cost advantage over competitors, the management team’s considerable industry experience, and high-quality exposure.

This strategy tends to hold smaller, more value-oriented companies compared with its average peers in the Pacific/Asia ex-Japan Stock Morningstar Category, according to Morningstar.

Asia is home to one-third of the world’s population, and close to one billion of its residents have been lifted out of poverty in the past decade due to globalization and mass industrialization. According to the McKinsey Global Institute, China is expected to have 221 cities with more than one million inhabitants by 2025. That same year, the urban economy is expected to generate over 90% of China’s GDP.

For more news, information, and strategy, visit the Dividend Channel.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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