China economy grows at slowest pace in 28 years

  • China economy grows at slowest pace in 28 years

China economy grows at slowest pace in 28 years

According to the latest figures from Beijing, China's economy grew by 6.6% last year, the lowest since 1990, the year after the Tiananmen Square massacre, the Guardian reports.

Shortly ahead of revealing data for 2018, Beijing announced Rmb1.3 trillion ($193 billion) of stimulus measures, including tax cuts for small businesses, to inject some adrenaline into the sluggish economy.

After years of breakneck growth, the world's second largest economy is losing steam, evidenced by slowing consumer spending, manufacturing output, and investment.

"Downward pressure on the economy is increasing", the commissioner of the National Bureau of Statistics, Ning Jizhe, said at a news conference.

Still, Ning insisted China can resist shocks, saying "the long-term trend of stability will not change".

The number of children born in China declined for the second straight year in 2018 despite the country relaxing its one-child policy two years ago, government data released on Monday showed. The economy faltered most at the end of the year, recording 6.4 per cent growth for the fourth quarter.

Before the population data was released, Chinese experts forecast that the number of birth for past year would continue to fall due to causes such as rapid decline in the number of women at childbearing age and people's lack of willingness to have more babies.

The state-run Chinese Academy of Social Sciences has projected that the population could start shrinking from 2027 - three years earlier than expected - if the birth rate held steady at 1.6 children per woman.

The U.S. trade deficit with China grew to a record $323.3 billion in 2018. The downturn deepened in the final months of 2018, suggesting the Trump administration's imposition of tariffs on Chinese goods is having an effect. But exports contracted more sharply than forecast in December as the penalties began to depress demand. Both countries have slapped billions of dollars worth of tariffs on each other's goods and are now negotiating a deal to end the dispute.

"The slowdown in credit growth is causing economic momentum to falter", said Mark Williams, chief Asia economist at Capital Economics, in a note last week.

Chinese vice premier Liu He will visit the United States on 30 and 31 January for the next round of trade talks with Washington. The government's control of that process is being tested by the standoff with U.S. President Donald Trump over trade at a time when the global expansion is already looking shakier. That's the slowest growth rate in 28 years. "However, non-infrastructure business activities will be dismal this year".

The reading was lower than the 6.8-percent growth registered in 2017.