BEIJING – China’s economy weakened to deliver its slowest pace of growth in three decades in 2019, as weaker domestic demand and trade tensions with the United States took their toll, official data showed Friday.
Gross domestic product for the world’s second-largest economy grew by 6.1 percent last year, its worst performance since 1990, according to the National Bureau of Statistics.
The figure matches an AFP analyst forecast and is within Beijing’s official target of 6.0 to 6.5 percent. Last year’s growth was down from 6.6 percent in 2018.
While China’s economy had been gradually losing steam over the first three quarters, growth stabilized at 6.0 percent in the last three months of 2019 — the same pace as in the third quarter, according to the National Bureau of Statistics, or NBS.
Ning Jizhe, commissioner of the NBS, said China’s economy generally sustained stable growth momentum in 2019.
“However, we should also be aware that the global economic and trade growth is slowing down,” he said at a news conference.
He added that there were more sources of instability and risk, with the economy facing “mounting downward pressure.”
The figures were released after a truce was reached Wednesday in the nearly two-year-old trade war, when U.S. President Donald Trump and Chinese Vice Premier Liu He signed the first phase of a larger agreement.
The mini-deal includes a pledge by China to purchase $200 billion worth of U.S. goods over two years. In return, the U.S. has pledged to halve some of the tariffs imposed on China, but levies remain in place on two-thirds of more than $500 billion in imports from the country.
The World Bank said in a report this month that weakening exports in China had compounded the impact of its ongoing slowdown in domestic demand.
Policy uncertainty and higher tariffs on exports to the U.S. also cast a pall on manufacturing activity and investor sentiment, it added.
The latest data showed that China’s industrial production grew by 5.7 percent last year, down from 6.2 percent in 2018.
Retail sales growth came in at 8.0 percent, down from 9.0 percent in the year before.
In December, sales grew 8.0 percent, and the NBS noted that online retail sales in particular had a strong showing.
But analysts note that China’s slowdown is structural, as it becomes a more developed economy and faces demographic challenges such as a shrinking number of people of working age.
Louis Kuijs, head of Asia economics at Oxford Economics, said Beijing considers such a slowdown part of a “new normal.”
He added that major policy easing is unlikely as well, given the improvement in external outlook after the phase one trade deal and other signs of stabilization.
He noted that Beijing likely wants to keep its powder dry, with policymakers aiming for stabilization rather than a pick-up in growth.
“What they don’t want to see is a too-rapid slowdown,” he said.