China's 2019 GDP Growth Slowest Since 1990, As Trade War, Domestic Turmoil Takes Toll

China's economy grew by 6.1% in 2019, the National Bureau of Statistics of China said Friday.

What Happened

This is the slowest annual growth for China's gross domestic product since 1990, when international sanctions following the Tiananmen Square Massacre weakened the country's economy.

The number is still in line with the government's own expectations, which had predicted a GDP growth between 6% to 6.5%, and those of the International Monetary Fund and the World Bank.

The slower growth comes as China faced a trade war with the United States and political turmoil at home with raging protests in Hong Kong. The GDP grew the slowest in the third and the fourth quarter at 6%.

China posted a GDP growth of 6.6% in 2018, which was the lowest since 1990 at the time.

Hong Kong's economy is worse affected, as its GDP shrank by 1.9% in 2019, according to the IMF, and 1.3% according to official government data.

What's Next

Analysts are expecting China's GDP to recover in 2020, Reuters reported, as tensions over trade with the U.S. seem to have eased following the signing of phase one of their trade agreement.

Important tariffs on about $360 billion in Chinese imports remain, as the "second phase" of the deal isn't expected to be signed at least until the U.S. presidential elections in November.

According to Reuters, the Chinese government could keep an even lower GDP growth target of around 6% for this, as it looks to increase spending on infrastructure to avoid further slowdown.

Stock Performance

Shanghai Composite was up 0.09% at 3,076.90 at press time. Shenzhen Component traded 0.1% lower at 1,809.82.

Hong Kong's Hang Seng Index was down 0.04% at 28,870.29.