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Trump's pending tariffs may stifle China's economic growth
China’s economy might spiral into turbulence! According to Reuters, the tariffs that incoming US President Donald Trump plans to impose could slow down China’s economic growth by 0.5 to 1 percentage point.
Additionally, Trump might set tariffs on Chinese imports at 40% instead of the previously hinted 60%. The Republican, who will take office in January 2025, announced hefty tariffs on Chinese goods during his campaign, sparking concern in Beijing and raising risks to China’s economic growth. Experts now anticipate a slowdown in China’s growth of 0.5–1 percentage point.
Analysts believe that Beijing will need to ramp up efforts to boost domestic demand. Officials in China have been working on this since late September 2024. However, their measures may not be enough to offset the anticipated export decline. New initiatives might be required to stabilize the situation.
Despite these concerns, most economists surveyed by Reuters kept their forecasts for China’s GDP growth at 4.8% in 2024 and 4.5% in 2025. Their predictions remain largely in line with pre-election estimates. For now, analysts and market players are waiting to see how the Trump administration's trade policies unfold. Adjustments to projections may come later.
Earlier reports suggested that Chinese authorities breathed a sigh of relief upon learning that Trump’s new administration does not include figures openly hostile to Beijing, such as former Secretary of State Mike Pompeo.
Published 22 November 2024
© InstaFintech Group
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© InstaFintech Group
