During the second quarter of 2020, China helped compensate US companies for orders that had been lost in the local market.
The directors of some American brands admitted that Beijing has saved them from financial failure. Nike and Tesla are among the companies driven by the Asian giant’s strong economic performance.
According to published Wall Street Journal, the chief operating officer of Skechers USA Inc., David Weinberg said that China has become a “story of recovery, stabilization and growth”. Sales of this shoemaker had fallen by 42% last quarter, but in China, they grew as much as 11.5%.
Despite mounting tensions between Washington and Beijing, Chinese consumers have not turned their backs on American brands, and these companies have been able to take advantage of the recovery in the Chinese economy. For example, total revenue for LVMH Moet Hennessy Louis Vuitton fell 38% from April to June but rose 65% in China.
Analysts believe that retail sales in China will grow again in the third quarter. Furthermore, Economist Group experts forecast a growth of 2.4% in the fourth quarter.
In the first quarter, China’s GDP contracted by 6.8%, but it began to recover in the second quarter. Until then, the Asian giant’s economy had grown by 3.2%. Meanwhile, the US GDP decreased by 32.9% in the second quarter of 2020 compared to the same period of the previous year.
Relations between the US and China remain tense after the trade war since 2017. Despite the fact that in early 2020, China and the US entered the “first phase” of a trade deal, when Beijing agreed to buy more US products. However, the US later accused China of hiding data on the spread of the coronavirus and refused to conclude the “second phase of the deal.”