Growth slow despite ‘significant’ efforts
BEIJING – China reported weak trade activity in August, raising pressure on the central government to stimulate its slowing economy as the country ambles toward a once-in-a-decade leadership transition.
Imports fell 2.6 percent from a year earlier after growing 4.6 percent in July, underlining China’s softening demand for commodities and raw materials. Exports grew 2.7 percent from a year ago, up slightly from 1 percent growth in July.
The weak import and export data announced Monday comes a day after China said industrial production had expanded at its weakest pace in three years. China also said Sunday that inflation had risen 2 percent from a year ago, up from 1.8 percent growth in July.
Worsening inflation will make it harder for policymakers to stimulate the world’s second-largest economy, which grew 7.6 percent in the second quarter, its slowest rate since the 2008 financial crisis.
China recently announced a slew of infrastructure projects such as new subway lines. It also unveiled subsidies for energy-efficient consumer goods. But analysts say China will have to do more if it hopes to raise growth by next month when the leadership handover is expected to take place.
“Despite a series of fairly significant measures over the last nine months – ranging from rate and reserve ratio cuts, to fiscal tweaks and loan rollovers – growth has not revived,” said Alistair Thornton, a Beijing-based economist for IHS Global Insight. “That is not to say the measures have been ineffective. Without them, the economy would surely look even more awful. But they have been insufficient, and so yet more fuel is being added to the fire.”