According to National Bank of Canada’s analysts, Krishen Rangasamy, the share of goods exports to the U.S. in China’s GDP is now at the lowest level in 20 years.
Key Quotes:
“China’s real GDP growth remained strong in the second quarter (6.7% on a year-on-year basis) and is well on track to hit the government’s annual growth target of 6.5%. More importantly, Beijing is succeeding in rebalancing its economy away from trade, with consumption and government spending accounting for almost 80% of Q2 growth. With growth tilting towards domestic demand, China’s vulnerability to a potential trade war is arguably diminishing.”
“Goods exports to the U.S. still account for a significant 19% of China’s overall merchandise exports.”
“Given that domestic demand is growing faster than exports, goods exports to the U.S. now account for just 3.3% of China’s GDP, the lowest in at least 20 years.”
“With growth tilting towards domestic demand, China is becoming less and less dependent on trade”.
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