HOUSTON, November 6, 2020 — Asia Society Texas Center (ASTC) welcomed chairman and CEO of the Hong Kong-based private equity firm PAG, Weijian Shan, along with J.P. Morgan Private Bank Vice Chairman and ASTC vice chairman Martyn E. Goossen, for a conversation on the global economic recession caused by the COVID-19 pandemic and the differences in how China and the United States handled the virus. 

How did China recover so quickly?

Goossen began by asking Shan about the vast difference in numbers of coronavirus cases and deaths when comparing China and the United States. Goossen noted that in China there have been approximately 90,000 cases with only 4,700 deaths, despite China’s population of 1.2 billion people and the fact that China was the origin point of the virus. Meanwhile, Goossen shared that the U.S. recently reported over 9.5 million cases and over 230,000 deaths. Shan explained that the reason China had so many fewer cases had to do with how China handled the initial outbreak; he pointed to how quickly China went into lockdown to ensure that cases would not continue to spread and enforced a standard measure to hospitalize anyone who tested COVID positive. Meanwhile, in countries like the U.S., people were only hospitalized if they had symptoms and those who tested positive without symptoms were often told to self-quarantine.

Shan continued by noting that China spent the full first quarter of the year in lockdown, leading to a very steep drop of 6.8 percent in the country’s GDP. Despite this, Shan said China did not reopen until the caseload reached zero — which did not happen until March — allowing for any new cases to be handled more quickly and easily. He also discussed the role of rapid, widespread testing, citing for example that when a single case appeared after the lockdown period, 10 million people in the surrounding area were tested in two days to identify and prevent any additional cases. Due to these efforts, Shan said that even though there was an initial drop in China’s GDP, in the second quarter of this year the GDP grew by 3.2 precent over last year and, for the third quarter, 4.9 percent.

What businesses have been most affected? 

In the United States, Goossen indicated that one of the industries most affected by the virus has been the hospitality business, due to the dramatic drop in travel as a result of the lockdown, followed by concerns around contracting the virus. Shan responded that, in China, the hospitality industry was not as heavily impacted, as things began to return to normal after the initial lockdown: soon after March, domestic travel within China had no restrictions, which given China’s large size allowed for flights to many different cities. Additionally, because the cases had hit zero, Shan said businesses such as restaurants and movie theaters also opened up quite quickly, allowing for parts of the entertainment industry to start their road to economic recovery.

According to Shan, the biggest winner of the pandemic has been e-commerce businesses, such as Amazon and Alibaba, which saw immense growth during periods of lockdown; he said in China the retail industry had taken quite the hit because of e-commerce. However, he expressed optimism that as things start to return to normal, the retail businesses that struggled due to the pandemic would slowly recover as well, although he noted that China has been very timid about its government stimulus plans and support for small businesses. He also said it was a good time to start a business, for those with good ideas and looking for capital funding, as there was unprecedented liquidity in world market.

What are the lessons learned? 

Goosen ended the conversation by asking Shan what he hopes we will learn from the global pandemic. Shan replied that it might still be too early to know what lessons to take away as the pandemic is still ongoing, but he said that does not mean that there will be no lessons to learn whatsoever. “You learn from every crisis to do much better,” he said, “and the next time around you will do much better.”

Business and Policy programs are endowed by Huffington Foundation. We give special thanks to Bank of America, Muffet Blake, Anne and Albert Chao, ConocoPhillips, ExxonMobil, Nancy Pollok Guinee, and United Airlines, Presenting Sponsors of Business and Policy programs; Nancy C. Allen, Chinhui Juhn and Eddie Allen, and Leslie and Brad Bucher, Presenting Sponsors of Exhibitions; Dr. Ellen R. Gritz and Milton D. Rosenau, Presenting Sponsors of Performing Arts and Culture; Wells Fargo, Presenting Sponsor of Education & Outreach; and Mitsubishi Corporation (Americas), Presenting Sponsor of the Japan Series. General support of programs and exhibitions is provided by The Brown Foundation, Inc., The Hearst Foundation, Inc., Houston Endowment, Inc., the City of Houston through Houston Arts Alliance, McKinsey & Company, Inc., National Endowment for the Arts, Texas Commission on the Arts, Vinson & Elkins LLP, and Mary Lawrence Porter, as well as Friends of Asia Society.

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