Sino File | China’s bid to boost economic growth will do more harm than good
- A slowdown in growth is to be expected given China’s economic restructuring. Overreacting and jeopardising that restructuring will bring short-term gain, but long-term pain
The 6.6 per cent rate of growth in China’s gross domestic product in 2018 is the lowest increase since 1990, when sanctions imposed by the West in response to Beijing’s violent crackdown in Tiananmen Square meant it grew just 3.9 per cent.
China’s economic growth has been steadily decelerating over the past decade, ever since its high of 14.2 per cent in 2007. The downward trend picked up pace quarter by quarter last year. It was 6.8 per cent in the first quarter, 6.7 in the second, and 6.5 in the third. The 6.4 per cent growth of the fourth quarter was the lowest since the beginning of 1992, when Beijing began publishing quarterly GDP data.
But the bigger worry to policymakers is that the latest data showed a loss of momentum in the three engines of the world’s second-largest economy – exports, investment and consumption.