Trade war hardly affects economy

August economic growth higher than July’s: NBS

The impact of trade frictions with the US has a limited effect on China’s economy based on August economic data, a Chinese official said on Friday.

China’s total trade stood at 2.7 trillion yuan ($394.09 billion) in August, up 12.7 percent year-on-year, and 0.2 percentage point higher than July’s growth rate, data released by the National Bureau of Statistics (NBS) showed Friday.

Exports were valued at 1.44 trillion yuan in August, up 7.9 percent from the previous year and 1.9 percentage points higher than July’s.

“August trade maintained relatively quick growth, especially exports,” NBS spokesperson Mao Shengyong told a press conference on Friday. He attributed this to Chinese enterprises’ rising competence and adaptability to market competition.

“Some Chinese firms also chose to export their products earlier amid the uncertainties from the China-US trade frictions,” he added.

China likewise reported better-than-expected industrial output and retail sales on Friday.

Industrial output in August rose 6.1 percent year-on-year, 0.1 percentage point higher than in July. Total retail sales of consumer goods increased by 9 percent from a year earlier, beating an 8.8 percent forecast, the NBS said.

Dong Dengxin, director of the Finance and Securities Institute at the Wuhan University of Science and Technology, said the growth rate of industrial output staying lower than the first half’s GDP growth rate of 6.8 percent is not a bad thing, indicating the services industry is driving economy.

Industrial output, officially called industrial value added, is used to measure the activity of designated large enterprises with an annual turnover of at least 20 million yuan.

“Major economic data, including targets for growth, employment, pricing and exports have been relatively steady,” Mao said.

Mao said the ongoing trade frictions are bound to cause some impact on the world’s two largest economies, and the effects have spread to relatively weak economies in the world.

“International trade and the world economy are still recovering, but some indexes performed poorly in August,” Mao noted.

Fixed-asset investment growth slowed to 5.3 percent from January to August, dragged down by slowing infrastructure.

“After a rapid increase in investments over the past few years, China has embraced a steady period characterized by destocking, de-capacity and deleveraging,” Dong told the Global Times Friday.

Growth in infrastructure spending slowed again to 4.2 percent in the first eight months of the year, compared with a 5.7 percent rise for the January-July period.