China’s economic growth sank to a three-decade low in 2016 as its struggling exporters brace for a possible trade battle with President-elect Donald Trump.
Growth in the quarter ending in December ticked up to 6.8 percent over 2015, supported by government spending and a real estate boom, a gain from the previous quarter’s 6.7 percent, government data showed Friday. Still, for the full year, growth came in at a lackluster 6.7 percent, down from 6.9 percent in 2015 and the weakest since 1990’s 3.9 percent.
That temporary upturn is unlikely to last, economists said.
«We expect clearer signs of a renewed slowdown to emerge during the next couple of quarters,» said Julian Evans-Pritchard of Capital Economics in a report.
Trump’s promise to raise tariffs on Chinese goods after he takes office Friday has fueled tension with Chinese leaders who are trying to keep growth on track while they overhaul a state-dominated economy.
Beijing wants to nurture more self-sustaining growth based on domestic consumption but trade still supports millions of jobs. Exports fell 7.7 percent last year and more losses could lead to a politically dangerous spike in layoffs.
In a rebuke to Trump, President Xi Jinping warned in a speech this week a «trade war» would harm everyone involved. The American Chamber of Commerce in China said Beijing is preparing to retaliate if Trump acts.
«I am hopeful that after his election, President Trump will consider the issue from the angle of mutual benefit and win-win and will develop the long-term, cooperative ‘big country’ relations that have been formed between China and the United States,» a member of the Cabinet’s planning commission, Ning Jizhe, told a news conference.
Asked about the potential impact of action by Trump, Ning said China should maintain «medium to high-speed growth.
