Ms. Gopinath, China shocked with reports that the economy contracted sharply in April.

Is China threatening to drag the global economy into a recession?

Winand von Petersdorff-Campen

Economic correspondent in Washington.

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We had expected severe setbacks for China due to the recurring Covid outbreaks and the lockdowns and accordingly reduced the growth forecast to 4.4 percent this year.

But the fresh data is even worse than we expected.

The development is of great concern to us.

It obviously has implications for the rest of the world.

This applies above all to regions with close trade ties to China, such as European and Asian countries.

Our data shows that delivery times are increasing and supply relationships are disrupted.

The risk to global economic growth is great.

Has China's pandemic policy failed?

The Zero Covid policy worked pretty well in 2020 and 2021.

China's economy recovered faster than most countries after the first slump, while the country also had low death rates.

Today the picture is different with significantly more contagious virus strains.

China must now balance the health and economic consequences of the lockdowns.

At the same time, the vaccination rate must be increased significantly.

It turns out that three doses are needed to ensure protection against severe disease.

China is now following the strategy of ramping up the vaccination rate quickly.

Should China allow vaccines from the West to speed up the process?

Our experts say that after three doses, the Chinese vaccines provide the same protection as two doses of mRNA vaccines (Moderna and Biontech).

Therefore, the country can follow its strategy calmly.

Imports can generally not hurt, right?

No, certainly not.

How high is the risk that Germany, the entire EU or America will slide into a recession?

The question is unclear.

There is still a great deal of uncertainty as to whether there will be recessions in the USA or the EU this year or next.

I think a technical recession in some countries is possible.

In Germany, France and Italy, for example, the economy has lost momentum.

Growth there will be very weak towards the middle of the year.

We are noticing several risks that could drag down global growth: an escalation of the war in Ukraine, the tightening of sanctions and countermeasures, and a further slowdown in growth in China due to the Covid outbreak and the fragile real estate sector.

In addition, the pandemic is not over yet, new variants can still spread.

Because there are so many factors at play

the probability of a recession is difficult to determine.

For now, we expect strong growth slowdowns in the targeted countries, but that they remain solidly positive.

You speak of a technical recession.

Is it less bad than a real one?

This means that a country's economy can contract in two quarters while remaining positive throughout the year.

In contrast, there are deep, long recessions, which we certainly do not expect.

The crises expose the vulnerability of Germany, which depends on energy from Russia and trade with China.

Would you recommend a new business model for the country?

It is true.

The war has confronted Germany in particular with special challenges, especially when it comes to energy procurement.

That will surely change.

It's changing pretty quickly.

Last year, Germany got 55 percent of its gas from Russia, now it's only 35 percent.

In the medium term, Germany wants to become completely independent of Russian imports.

We also register that Germany is of course particularly hard hit by the shocks to global supply and value chains because it is more dependent than other economic powers on trade in industrial goods with the rest of the world.

Germany has to deal with a completely new situation in which pandemics, wars or geopolitical tensions are disrupting supply relationships and production chains.

What can Germany do?

The classic solution lies in diversifying trade, i.e. instead of concentrating on a few sources of supply, spreading procurement over several countries.

But there are also technical answers: companies can make their production more flexible if the process also allows for preliminary products that do not completely correspond to the classic set goods.

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