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SHANGHAI: Chinese growth has only slightly slowed in the second quarter, the impact of the worsening of the trade dispute with the United States has not yet occurred, according to badysts surveyed by AFP.
The second-largest economy grew 6.7% in April-June when it released figures on gross domestic product on Monday, according to a survey of 13 economists.
This would be down 0.1 point from the previous three quarters
Economists have said the threat of having to pay for tens of billions of dollars worth of goods traded between the two The world's largest economies – which officially went into effect last week – would not have significant impact before
The Trump administration enforced duties on 34 billion US dollars July 6, China taking immediate countermeasures against the dollar.
promising to impose new rights on $ 200 billion of additional Chinese goods, with Beijing promising to retaliate.
Exports still represent an important part of the Chinese economy and tariffs or announced by Washington target a wide range of goods, including cars, machinery, electronic devices and consumers.
If Trump follows his latest threats, the United States would have imposed duties on about half of China's exports to the country.
Capital Economics said that the cumulative impact of the measures currently on the table could potentially reduce China's overall economy by 0.5 percentage point, but that the impact could s & # 39; Aggravate if the battle intensifies
. against, Beijing is finally seen as having a weaker hand.
BRACE FOR IMPACT
If a full-fledged trade war develops, China may have to retry According to Liao Qun, chief economist of Citic Bank International, the services, investment and potential creation of new hurdles for US companies operating in China
"The real impact will begin to manifest itself next year.And if it is a full-fledged trade war, in the worst case, China's GDP growth could fall below 5 percent, "said Liao. If we add to that the impact on GDP growth, the additional uncertainty is already undermining business confidence and delaying investment globally. Overall, the trade war will weigh on growth, confidence, financial markets and supply chains, "he said.
Shanghai's Key Composite Index has already fallen by 14% this year due to turbulence China in the short term – which has campaigned to discourage excessive credit in the fear of inflating debt – is likely to change course slightly and relax monetary policy to maintain the rate of economic growth and offer subsidies to exporters.
Eventually, the trade war between China and the United States could push Beijing to intensify its current efforts to encourage domestic demand as a proportion of Economy, a strategy aimed in part at reducing the rise and fall of global demand. "The best case is that the United States is retreating. If the United States shows an intention to retreat, China will certainly accept a compromise, "said Liao
" But it is really difficult for people to predict what the United States will do. "
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