The emerging V-shape recovery

Faced with a severe economic downturn at the end of last year and the beginning of this year, people are debating intensely the prospects of the Chinese economy. However, there is increasing evidence to indicate that the ongoing recovery is likely to be V-shaped.

Factual evidence of a strong rebound can be found in China's steel output, electricity production, industrial value added, foreign trade as well as the Shanghai Exchange's A share index which has jumped by 65 percent so far this year. China's surprising pent-up automobile sales amid the global recession shows that no matter how radical a prediction about the Chinese economy is, it still risks being too conservative. The country is now set to break the mark of selling 10 million new cars in a year. Yet not so long ago it was still deemed too optimistic to expect that the country's car sales can reach that figure by 2015.

What explains China's rapid recovery?