China’s economy avoided a hard landing in 2016 thanks to robust monetary and fiscal stimulus, but policymakers are now bracing for headwinds as a possible trade war looms under the US presidency of Donald Trump.
The world’s second-largest economy grew by 6.7 per cent for the full year and 6.8 per cent in the fourth quarter, down from 6.9 per cent in 2015. It was the slowest full-year growth figure since 1990 but comfortably within the government’s target range of 6.5-7 per cent.
In a speech to the World Economic Forum in Davos on Tuesday, Chinese President Xi Jinping defended free trade and globalisation, drawing an implicit contrast with Mr Trump. Mr Xi will take satisfaction in the Chinese economy’s resilience last year, after a tumultuous beginning punctuated by dramatic falls in both the stock market and the renminbi exchange rate, which sent global markets reeling.