CHINA’S economic growth in the fourth quarter slowed to its weakest level since the financial crisis, according to official data.
China has shot to the top of global investors’ risk lists for 2016, after a renewed plunge in its stock markets and yuan currency fuelled worries that the economy may be deteriorating.
China is locked in the middle of a protracted slowdown, leaving the US as the only main driver of the global economy.
Growth in fourth-quarter gross domestic product (GDP) eased as expected to 6.8 per cent from a year earlier, down from 6.9 per cent in the third quarter and the weakest pace of expansion since the first quarter of 2009.
Full-year growth of 6.9 per cent, enviable by Western standards, was China’s poorest showing in a quarter of a century.
Rain Newton-Smith, the CBI’s director of economics, said: “These figures paint a picture of a Chinese economy which is slowing and rebalancing, but still making a huge contribution to the global economy.
“In recent weeks, financial markets have struggled to digest this situation, alongside further weakness in oil prices.
“While direct links between the UK and China are relatively small, the spill-over effects from China’s economic slowdown, alongside continued volatility in financial markets, amplify the downside risks to growth in the UK.
“Nevertheless, it’s important not to be too downbeat about China or emerging markets more generally. With household incomes up by seven per cent, and online retails sales growing by 33 per cent last year, China represents a lucrative market for British business.”
John Redwood, of Charles Stanley, said the Chinese figures should not have come as a surprise to the markets.
He added: “The Government had long heralded a slowdown in growth, and the final figures for last year were similar to their indications over recent months.
“The Chinese economy, according to the official figures, is still one of the fastest growing economies in the world. As planned, its growth is now coming more from consumer demand and services and less from industry and exports.
“Some commentators think the official figures flatter, but so far China has avoided the hard landing of tipping into recession that has worried the pessimists.”