But China did not escape being hit hard by the economic crisis. The effect was first felt in the export sector, when world markets collapsed and exports fell precipitously. This downturn can be seen in the quarterly statistics on export growth (Figure 1): China’s export growth plummeted from the fourth quarter of 2008 through 2009. Factories closed seemingly overnight, and workers were laid off. In the coastal export enclave of Dongguan in Guangdong province, so many workers had been sent home by mid-2009 that huge
industrial parks resembled ghost towns. Given that exports had comprised one-third of GDP in value, the sharp downturn in exports exerted a drag on GDP growth that was a stunning –41% in 2009 (Figure 2).