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China’s GDP Growth Rate Plunges To Its Lowest Since 1990; Trade War With US Cited As Main Reason
Chinese President Xi Jinping
China on Monday announced that its official economic growth came in at 6.6 per cent in 2018 — the slowest pace since 1990. China’s GDP grew by a tepid 6.4 per cent in the fourth quarter of 2018, according to data released on Monday by the National Bureau of Statistics. China's economy grew 6.7 per cent year-on-year in the first three quarters of 2018.
China’s growth rate in 2018 was lower than its 6.8 per cent in 2017. The nadir it has seen was at 3.9 per cent, in 1990.
"We have confidence that China's economy will maintain a reasonable growth rate in 2019," said Ning Jizhe, head of the National Bureau of Statistics (NBS).
Ning said China's confidence comes from the massive consumption power at home, with a middle class of more than 400 million, and new drives from tech and other innovative industries amid an economic upgrade.
"US unilateralism, protectionism and the China-US trade tensions have affected market confidence, causing private sector investment to slow in China," said Cong Yi, a professor at the Tianjin University of Finance and Economics.
Trade frictions' influence over market confidence became more apparent in the fourth quarter, weighing on China's economic growth, said Cong. Cong said China could achieve an 8 per cent GDP growth rate if it fully taps the country's potential.
"The China-US trade tensions, a hindrance to China's domestic economic transformation and upgrading, coupled with lack of confidence from investors, resulted in the nation's declining GDP growth in 2018," said Dong Dengxin, director of the Finance and Securities Institute at Wuhan University of Science and Technology.
Even if the Sino-US trade friction continues in 2019, China's economic situation will not be worse than 2018 as it is now fully prepared for the future economic moves, said Dong.
Beijing’s official GDP figures have long been received with scepticism by many experts ."The official GDP figures have been too stable in recent years to be a good guide to China's economic performance," CNBC quoted Julian Evans-Pritchard, senior China economist at Capital Economics, a research house, as saying.
(With Inputs from Global Times)
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