Brentley Maddox Global - Trade War May Help China's Economy

Brentley Maddox Global - Downward economic pressures may force China to rebalance its economy.

Analysts at Brentley Maddox Global say China’s economy is on course to reach growth of 6.6 percent this year and may slow to around 6.3 percent in 2019.

China has been dealing with a number of issues caused by the ongoing trade war with the United States as well as problems arising from operational reform and this shows in the anticipated cooling of economic growth. In September, China recorded its slowest quarter of growth in 9 years, reaching only 6.5 percent quarter on quarter.

However, Brentley Maddox Global analysts say the challenges caused by the trade war may not all have a negative outcome for the world’s second-largest economy.

The firm’s analysts believe China may have outgrown the world market and that even without the trade war, China’s economy would not thrive given the weakening world trade environment. China’s economy is in need of rebalancing and as an indirect result of the trade war, that opportunity may present itself.

Running out of effective short-term measures to cope with the strain of the trade war, next year may be a time for China to restructure its economy and switch to a better quality growth strategy.

In order for China’s economy to survive the downward pressures that will be caused by the trade dispute, China will need to balance its exports and imports and provide a fair environment for foreign businesses operating within its region.

Brentley Maddox Global analysts say China’s imports could increase by as much as 16.1 percent next year compared to the much smaller increase of 6.1 percent seen this year.

China’s government has already pledged to widen access to its market for foreign investors but many investors feel that these promises are a long way from being fulfilled.

Source: Brentley Maddox Global


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