Slowest growth of Chinese economy since 1990s
Figures have shown that Chinese economic growth in the latest quarter was the slowest since the 1990s.
Growth for the three months leading up to June was at a +6.2 per cent in comparison to the previous year.
By contrast, over the past three decades the average annual growth rate for the country has consistently been around 10 per cent, which was largely regarded as unsustainable by most economists.
This figure is in line with forecasts for the period and follows moves by the country to try and stimulate its economy.
It comes amid China having recently boosted spending and introduced tax cuts as a means of generating growth.
The Chinese national statistics bureau said the slowdown was due to a “complex environment” both within the country and internationally.
The country is also currently fighting a trade war with the US, which is said to have hurt businesses and impacted growth.
US President Donald Trump said that US tariffs were having a “major effect” on the Chinese economy.
Chinese officials described ongoing factors influencing the slowing of the economy as “new downward pressure”.
There have been calls for the country to be less dependent on international investment and exports and instead increase consumer spending within China.
There have been some shifts towards this, although rates of saving and investment remain very high.
Concerns over high levels of company debts have also featured in official discourse.
Following the global financial crisis, authorities encouraged strong credit growth, which helped prevent a more rapid and disruptive slowdown, but at the expense of creating additional financial risks.
The impact on the global economy of this slowdown is a valid concern from other countries.
Beijing has announced plans to boost spending and cut billions of dollars in taxes to support the economy.
Edward Moya, senior market analyst at Oanda, said that markets should “expect further stimulus” from the Chinese government.
With relations with the US being another influencing factor on the slowdown, he described how “we are probably not near the bottom for China’s economy”.