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Chinese economy suffers huge damages as it battles trade war with the US

Beijing: The investments in China are at an all-time low, and there is also a reduction in industrial production. For the first time, demands within the country are showing a downslide. Also, China’s expenditure for infrastructural facilities has reduced considerably. All the factors bear evidence to the fact that the trade war with the US is causing a massive setback to the robust Chinese economy. Moreover, experts think that this situation is a harbinger of the perils that the Chinese economy is destined to face in the near future.

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The United States had targeted Chinese exports by levying import taxes up to 25% on goods from China worth $100 billion. The mainland had also retaliated by levying taxes on products imported from the United States. However, the US made another announcement of increasing import taxes on Chinese goods worth $500 billion, thus indicating to China as well as to the whole world that it intended to intensify the trade war further. Therefore, the pressure on the Chinese economy caused by the trade war is becoming evident. The mighty Chinese economy bearing enormous capacity has come under considerable strain and the recent statistics published by the country endorses this fact.

Information about a reduction in China’s GDP growth had been revealed in the month of July. The Chinese economy had seen a downfall in the quarter from April to June when the GDP growth had plummeted to 6.7%. This growth rate was the lowest since 2016, and in the quarter from January to March, it had been at a level of 6.8%. The reductions in its investments and industrial production were said to be responsible for this new decline in the Chinese GDP growth. The “National Statistics Bureau” of China had declared this information.

Subsequently, information regarding other important sectors of the Chinese economy has also been revealed which clearly shows that the economy is ailing due to huge damages. Industrial production, which is known to be a major factor contributing to the Chinese economy, has noted the growth of a mere 6%, which is 0.3% less than what had been earlier forecast by China’s “National Statistics Bureau”.

The investments being made in China has suffered the biggest blow. In the seven months from January to July, the growth in investments has been a mere 5.5% which is the lowest that China has seen in the past two decades. The investments made in the infrastructural facility projects, which was an attempt of the Chinese rulers to revive the declining economy, has also fallen to less than 6% as per the statistics revealed by the “National Statistics Bureau.” Public demand within the country has also reduced to less than 9%.

It is being said that in July, the rate of unemployment in the urban areas of China had gone up to 5%. This downfall that is being seen in all the major sectors of the economy is considered an indication of the impending dangers the Chinese economy might face in the near future. Some economists and analysts had forecast that if the “Sino-US” trade war intensified further, the Chinese economy would suffer a downslide of 0.3%.

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