China’s growth cools as tariff pressures mount
“The trade war is having a huge impact on the Chinese economy. As trade negotiations struggle for meaningful progress, we are probably not near the bottom for China’s economy.”
BEIJING — China’s economic growth sank to its lowest level in at least 26 years in the quarter ending in June, adding to pressure on Chinese leaders as they fight a tariff war with Washington.
The world’s secondlargest economy grew 6.2% over a year ago, down from the previous quarter’s 6.4%, government data showed Monday.
Hopes for an early growth rebound faded after President Donald Trump raised tariffs on Chinese imports in May to turn up pressure on Beijing over the aggressive tactics it’s using to challenge American technological dominance. Now, economists say the slowdown might extend into next year.
Weaker Chinese activity carries global repercussions. China is the world’s second-biggest export market behind the United States. Countries that feed raw materials to Chinese factories — from Chilean copper to Indonesian coal — are especially vulnerable to decelerating growth in China.
Among major economies, Australia sent 35% of its exports to China in April, Brazil 30% and South Korea 24%, according to the Peterson Institute for International Economics.
“The trade war is having a huge impact on the Chinese economy,” Edward Moya of OANDA said in a report. “As trade negotiations struggle for meaningful progress, we are probably not near Edward Moya of OANDA
the bottom for China’s economy.”
Chinese leaders have stepped up spending and bank lending to keep growth within this year’s official target range of 6% to 6.5% and avert politically dangerous job losses. But they face an avalanche of unexpectedly bad news, including plunging auto sales.
In the second half of the year, “the external environment may still be more complicated,” said a government spokesman, Mao Shengyong.
Quarterly growth was the lowest since China began reporting such data in 1993, according to an employee of the press office of the National Bureau of Statistics, Dong Hui.
Jittery consumers are putting off major purchases, depressing demand for autos, home appliances and other goods.
“I don’t think the country’s economy is as good as it looks,” said Peng Tao, a 26-year-old delivery courier who said he makes 5,0006,000 yuan ($750-$870) a month.
“China has been surely hurt more in the trade war,” Peng said. “I am not very happy about job prospects because there just aren’t many opportunities out there.”