The impact of Beijing’s trade tensions with Washington has been laid bare as new figures showed that China’s economy grew last year at the slowest pace in almost three decades.
Official data show that the world’s second largest economy expanded by 6.1% in 2019 from the year before - the worst figure in 29 years.
Although Beijing has been introducing measures over the past two years in an attempt to boost growth, the BBC says the “country has faced weak domestic demand and the impact of the bitter trade war with the US”.
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Marketwatch adds that: “Chinese exporters have been battered by President Donald Trump’s tariff hikes in a fight over Beijing’s technology ambitions and trade surplus”.
Reuters says Chinese policymakers have been “rolling out a stream of growth boosting measures over the past two years, while trying to contain financial and debt risks”.
Although Beijing is now widely anticipated to roll out further stimulus policies, the government is not expected to panic because it had targeted a range of 6% to 6.5% growth for 2019.
Also, as CNN points out, officials went into Friday’s announcement, “with one big issue behind them: Beijing this week signed a ‘phase one’ trade deal with the United States”.
However, Louis Kuijs, from Oxford Economics Hong Kong, predicts choppier waters ahead. “We still think China is in for slowdown later on, it’s in the midst of a structural slowdown. We have stabilisation 2020, but after 2020 we do think there will be more structural slowdown.”
Among the options Beijing is set to introduce is a cut to its one-year loan prime rate, the new benchmark lending rate, by a total of 25 basis points this year.
Asian stocks edged up after the GDP data was released, adding to moderate early gains. The yuan also steadied.
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