China’s Q2 GDP expanded 6.2% year-on-year, slower than Q1’s 6.4% and is the weakest since 1992.
For the first half of the year, China’s GDP grew 6.3% on-year, according to data from the statistics bureau showed.
China’s GDP goal for this year is 6% to 6.5%.
That means it has to achieve at least 5.7% of growth in the second half of year to meet its lowest target of 6%.
Despite the slower growth, industrial output grew 6.3%, much higher than May’s 5/0%.
In addition, retail sales growth expanded 9.8% year-on-year, versus May’s 8.6%.
However, net exports contributed to 20.7% to output growth in the first half, down from 22.8% in the first quarter.
A recent report by McKinsey & Company says that consumption contributed to more than 60% of China’s growth during 11 out of 16 quarters—from January 2015 to December 2018.
This implies that China’s economy has reduced its reliance on trade as a source of growth.
According to the report, China’s net trade—the value of total exports minus that of imports—made a negative contribution” to growth last year.
That could mean the current trade war with the US might have less impact on China than expected.
