The exhausting trade war between the U.S and China has seen both the country’s presidents making statements that are not in support of each other and in case of U.S president Donald Trump, false. Trump has been extremely vocal about the state of the Chinese economy is unstable. But as expected by many, China’s economy grew by a robust 6.4% in the first financial quarter of 2019. A spokesperson named Andrew Polk from Trivium China, a consultancy also said that Trump should take this a sign that the Chinese economy is here to stay. China’s National Bureau of Statistics has given the statistics stating the good position the Chinese economy is in and still stands as the second largest in the world. Bureau spokesman Mao Shengyong has officially stated that economically China is well balanced now with strong market expectations.
For the first quarter, economic stability was the result of spending on infrastructure and local governments using bonds. Many economists and experts have given their point of view on the steady rise in the Chinese Economy. Economist Eswar Prasad from Cornell University thinks this can bring along risks in the future. Chinese industrial production has also grown by 8.5%, raising a lot of questions in this tedious trade war situation. China is trying with all its might not to look weaker in front of the world amidst the trade negotiations. Bank loans in China have also hit a high record of $865 billion during the first quarter.
The Organization for Economic Cooperation and Development
It is difficult to say how much the trade war has affected the Chinese economy. The Organization for Economic Cooperation and Development thinks this war has affected the U.S and China’s growth rates with a very minute number. But, the important part is, it has. Organization for Economic Co-operation and Development’s Secretary-General Ludger Schuknecht. Very recently in Beijing mentioned that world trade can slow down by 0.4% by 2020.
The growth has been registered to be 6.4% to 6.1% in March. Many economists and experts around the world show interest in the U.S China trade war every now. And then with their comments and predictions. Many have also set alarms against the debt levels in China. They also suggest that China could be heading towards bankruptcy. If it will join Brazil and Japan in the downfalls that they have faced.
Organization for Economic Co-operation and Development in one of its latest reports has also warned China against its increasing corporate debts. It suggests China to avoid channeling all its fiscal stimulus to their own enterprises. Local governments as public debts are exceeding annual revenue with large margins. The overall stressful situation in China will soon decide its fate but as of now, things still look imbalanced and affected like annual trade shows like the Canton Fair and also job loss.