The Chinese economy grew at the slowest pace in 27 years in the second quarter of 2019. The country logged a growth of 6.2 per cent amid the trade tensions with the United States. The damaging trade with the US is seen as one of the reasons for the slump in the world's second-largest economy.
According to the National Bureau of Statistics (NBS), South China, the GDP growth of China slipped from 6.4 percent in the first quarter to 6.2 percent between April and June.
Chinese Premier Li Keqiang had earlier predicted the target for the economic growth to be between 6 and 6.5 percent this year. The figures on Monday fell within that range.
As per analysts, the economy is facing a complex situation along with rising external uncertainties. Currently, Beijing is locked in a protracted trade spat with Washington which has taken a toll on its economy. Though Beijing is trying really hard to cut a trade deal with their US counterpart nothing seems positive.
Meanwhile, President Donald Trump's decision to raise tariffs sharply on Chinese goods has severed the confidence of the consumer within the chinese economy.
The Chinese government said that exports suddenly dipped by 1.3 percent on Friday as compared to the previous year, while imports fell by 7.3 percent.
Due to the never-ending trade war, many multinational companies are forced to shift their supply chains elsewhere. Though most of them still continue to invest in China to supply Beijing's own market as well other in Asia and the rest of the world.
For the economy is running well since the government is pumping huge sums of money into infrastructure. The Chinese government is focusing to build high-speed rail lines, immense highway bridges, ports and other facilities to connect ever smaller and fewer effluent cities to the rest of the country.
Even though Infrastructure is making it easier to do business, bankers and economists are worried whether some of these investments will ever enough of a return to cover their costs.
(With inputs from agencies)
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