Guanxi: A Vitamin for China’s Economic Recovery in COVID-19 Pandemic?

In early 2020, the COVID-19 pandemic hit the Chinese economy and caused a substantial decline. As a result of the global economic downturn in the first quarter of 2020, China’s GDP declined by 6.8%, which was the lowest figure in the country’s history. However, in the second quarter, the economy rebounded with a growth rate of 3.2%. This phenomenon is interesting, as China was the first country to be economically affected by the pandemic, yet it recovered the fastest compared to other nations. Therefore, this article analyses the conditions that enabled China’s rapid recovery. Using the concept of hybridity, this article explores how China’s economic system, shaped by cultural hybridity, served as the primary driver of its economic rebound. Guanxi played a central role in this recovery. Guanxi enabled China to become the first major economy to recover during the COVID-19 pandemic because through the existence of renqing and mianzi as guanxi main components, private enterprises supported and assisted government policies during the COVID-19 pandemic and utilised their resources and expertise to help the government achieve its goals.