The Chinese economy has been hit by a raft of weak data in recent months, with 2018 marking China’s slowest annual pace of growth in almost three decades amid growing signs of financial weakness. The world’s second-largest economy has been dealt a further dent today after 23 of 31 provinces, regions and municipalities cut their economic growth targets for this year, compared to 17 provinces who braced for a slowdown in 2018. Shandong, China’s third-richest province, has yet to announce its 2019 target. Five provinces – Sichuan, Hebei, Guizhou, Gansu and Hainan – kept their targets unchanged from last year.
This compares with 12 provinces that maintained their targets in 2018.
Only one province – Hubei – raised its target, encouraged by an emerging high-tech manufacturing sector.
Tommy Xie, China economist at OCBC Bank in Singapore, said the projected slowdown was partly due to an ongoing trade war with the United States.
He added: “The new provincial targets reflect the challenges faced by China.
“Export-driven coastal areas are facing the risk of lower growth amid uncertainty from the US-China trade war.
“Western China will remain the key source of growth due to the rise of consumption and services.”
The downward revisions also imply China will set a lower national growth target this year, with Mr Xie predicting a range of 6-6.5 percent.
Gross domestic product (GDP) for October to December eased to 6.4 percent on-year, the slowest pace since the global financial crisis and down from 6.5 percent in the third quarter.
The figures from the National Bureau of Statistics drags full-year growth down to 6.6 percent, the slowest annual pace since 1990.
China, which has generated nearly a third of global growth in recent years, recorded GDP growth of 6.8 percent in 2017.
Trade tensions between the US and China escalated overnight after American officials issued criminal charges against Huawei.
The US has filed 23 charges against the Chinese telecommunication giant.
Wanzhou Meng, Huawei’s Chief Financial Officer, has also been charged in relation to the violation of sanctions against Iran.
Ms Meng was arrested in Canada last month and is facing extradition to the US.
Huawei said on Tuesday it was “disappointed” with the US charges and denied all the allegations, including the ones regarding Ms Meng.
The Huawei announcement came before trade talks with Beijing later this week and snuffed out a fledgling relief rally in global risk assets led by Chinese stocks and the euro currency.