Even as many reports state the negative effect of the trade war on China, the latest data shows that the economy is slowing down on growth, to 26-year lows.
China’s economy has grown at 6 percent for the third quarter ending September, according to reports on Friday. For the second quarter, growth was at 6.2 percent. The third-quarter GDP is much lower than the projected value at 6.1 percent.
This quarterly growth rate is the lowest since 1993 in China.
China’s growth has taken a great hit on consumer spending and domestic activity. Investments have come down, due to the tariffs that have increased business risks.
However, the most vulnerable are the exports from China to the United States. In September, exports to the U.S. have fallen 21.9 percent on a year-on-year basis. Overall exports from China have fallen by 1.4 percent, of which exports to the U.S. have been the worst hit. Meanwhile, imports have come down by 15.7 percent.
The trade war between the U.S. and China is taking its toll on the two economies. There is a growth slowdown not only in China but also in the U.S. as the nation has shown just 2.1 percent growth for the second quarter.
A temporary deal had been achieved between the two countries last week. It has postponed the tariffs that the U.S. had proposed on China and which was to take effect next week.
Though a preliminary deal was achieved last Friday, still some sticky points continue to evade a conducive agreement between the two countries.
Some of the very fragile topics were the agricultural purchases by China, intellectual property and the financial services that still continue to evade proper talks.
Trade tariffs have hit the global outlook too. The International Monetary Fund has cut the global growth forecast for 2019 from 3.2 percent to 3 percent.