Business

China Records Lowest Economy Growth Since 1992

China’s economic growth has dropped significantly in the last three decades owing to its continuous trade war with the United States. China has reported a 6 percent growth in the third quarter of 2019, which is the lowest quarterly growth since 1992. China’s second-quarter growth was slightly better with a 6.2 percent hike. The long-running slump in the Chinese economy is the result of the US-China trade dispute. China has failed to meet the forecast of 6.1 percent growth projected by the analysts. The figures emerged just after a week the United States and China finalized a provisional trade agreement.

Despite some bright signs in the month of September, economists are not very optimistic about growth in Chinese GDP. China’s economic growth is likely to go down in the next two quarters, said Chief China economist, Bo Zhuang. China’s GDP is expected to slow down further by 5.8 percent in the fourth quarter of the year. China’s full-year growth target is 6.1 percent. A slowdown in the global economy has also affected China’s production output. The International Monetary fund has recently reported its lowest growth forecast for 2019 to 3 percent. Geopolitical tension and trade restriction can be a major reason for the slow down, said chief economist IMF Gita Gopinath.

The tentative trade truce between China and the US includes a halt on US tariff increase to provide relief in the prolonged economic trade war. The interim deal also consists of Intellectual property, financial services, and agricultural purchases. As per the deal, the US will not move ahead with its plan to raise the tariff on Chinese goods worth $250 billion by 30 percent. The agreement is still in its first phase. Both parties will sign it in the month of November. President Donald Trump has been quite angry over China’s retaliatory tariffs. He demanded American companies to stop doing business with China and threatened to increase the tax on every Chinese goods before the end of the year.