The slowing growth of China
NEWS that China’s gross domestic product growth had slowed to 6.2 per cent was celebrated last week by US President Donald Trump and his trade team:
“China’s 2nd Quarter growth is the slowest it has been in more than 27 years. The United States Tariffs are having a major effect on companies wanting to leave China for non-tariffed countries. Thousands of companies are leaving,” Trump tweeted.
Here, at last, was clear proof that his trade war was working.
Well, for Trump’s base, maybe this storyline might strike a chord: the trade war is, after all, primarily a no-lose political ploy to improve chances of winning the 2020 presidential election. But, in reality, the conflict is harming everyone, from exporters worldwide to consumers, particularly in the US. And the longer it continues, the more harm it will do.
Singapore last week reported its economy shrank by 3.4 per cent in the second quarter, with a leading Singapore-based economist complaining of “a deepening manufacturing downturn for the rest of Asia.”
South Korea’s exports fell sharply in June while the International Monetary Fund warned that the trade war is set to knock 0.5 per cent off global growth, or US$455 billion.
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