Trade war could slice 1 per cent off China’s economic growth, top party official says
- Politburo Standing Committee member Wang Yang reveals ‘worst case scenario’ at forum for Taiwanese businesspeople in Beijing but says dispute will not do any long-term damage
- Firms should not relocate away from Chinese mainland as it still offers huge development opportunities, he says
The US-China trade war could slash one percentage point off Beijing’s economic growth this year, a senior Chinese policymaker said on Thursday.
Speaking to a group of Taiwanese businesspeople whose companies are based in mainland China, Wang Yang – one of the seven members of the elite Politburo Standing Committee – said that the government had assessed the impact of the near year-long dispute and estimated that in the worst case scenario gross domestic product growth would be one percentage point lower than expected.
Beijing had earlier set a target of 6 to 6.5 per cent growth for the full year.
While Wang did not outline any plans for dealing with the fallout from the trade war, he is the first official from the top policymaking body to speak so candidly about its possible impact on headline targets.
A member of the audience at the event in Beijing said that despite the official’s frank assessment, he did not seem too worried about the long-term effects of China’s spat with the US.
“Wang said that although the trade war would have an impact on the mainland’s economic development, and had caused significant waves it would not lead to any structural changes,” said the delegate, who asked not to be named but said he was based in Shanghai and was a member of the Association of Taiwan Investment Enterprises on the Mainland.
“He said the most pessimistic forecast was that it would trim one percentage point off the mainland’s GDP growth,” the person said.