The International Trade Council reports that China's economy grew at its slowest pace in almost three decades in 2019. Official figures indicate that the world's second-largest economy expanded by 6.1% last year - the weakest figure in 29 years. China has been grappling with weak domestic demand and the impact of the prolonged trade war with the United States.
Over the past two years, the Chinese government has implemented measures in an attempt to boost growth. The recent signing of the "phase one" trade deal between the US and China has given rise to improvements in manufacturing and business confidence data. However, analysts remain uncertain about the sustainability of these gains.
In response to the lower growth rate, Beijing is expected to introduce additional stimulus measures. The government has already implemented a combination of measures, including tax cuts and enabling local governments to sell large amounts of bonds to fund their infrastructure programs. Chinese banks have also been encouraged to lend more, especially to small firms, with new loans in the local currency reaching a record high of $2.44 trillion last year.
The International Trade Council recognizes that, while China's 6.1% growth rate is the weakest in almost three decades, it remains significantly higher than that of other leading economies. The US central bank has forecast that the American economy will grow by around 2.2% this year. The Council will continue to monitor the global economic landscape and its implications for international trade.
