Juncker pushes China to ‘open up’ on trade

CHINA’S economy is slowing down as fears over a trade war with the US have escalated, leading the EU to push Beijing to “open up” its market.

Figures released by the National Bureau of Statistics in China showed growth of 6.7pc for the second quarter, compared to the same period in 2017. This was lower than the 6.8pc growth reported year-on-year in the three months to March, but still above the regime’s target of 6.5pc.

However, accuracy of official data from China has long been questioned by economists, bringing the actual pace of the slowdown into doubt. An in-house measure of gross domestic product growth at Capital Economics suggested expansion was more than a percentage point lower, at 5.5pc, based on initial data for June.

Julian Evans-pritchard of Capital Economics said the fact that official figures were beginning to reflect the cooling of the economy was significant.

“This should make it easier for officials to justify a more supportive policy stance,” he said. This could include a cut in the official People’s Bank of China benchmark interest rate.

However, economists at Nomura said that China’s recent debt glut meant any efforts to raise government spending or slash interest rates would be curtailed. “The room for Beijing to manoeuvre is limited due to the rapid rise of onshore and offshore debt over the past few years. We expect the economy to worsen before getting better,” they said. The data comes as an emergent trade war between the US and China risks hitting business confidence, leading to delayed investments and threatening export activity.

Jean-claude Juncker, the EU president, said that China could open up its markets in fairer fashion if it wished to. Both the western bloc and China have been hit by US tariffs in recent weeks.

Mr Juncker told a summit in Beijing yesterday: “If China wishes to open up it can do so. It knows how to open up.”