US President Donald Trump has claimed that his tariffs are damaging China’s economy after its growth slowed to a 27-year low.
Read more: China growth slows to 27-year low
“The United States Tariffs are having a major effect on companies wanting to leave China for non-tariffed countries,” Trump tweeted.
He added: “We are receiving Billions of Dollars in Tariffs from China, with possibly much more to come. These Tariffs are paid for by China devaluing & pumping, not by the U.S. taxpayer!”
Chinese GDP climbed 6.2 per cent in the three months to the end of June, official figures showed today, falling from 6.4 per cent in the first quarter. It marked the lowest quarterly rate of growth since records began in 1992.
According to China’s National Bureau of Statistics, the country is also likely to face continued “downward pressure” going into the second half of this year.
The Trump administration ratcheted up tariffs on $250bn of Chinese exports to the US from 10 per cent to 25 per cent in May.
Julian Evans-Pritchard, senior China economist at Capital Economics, said that while exports decreased in June, “waning global demand” and a “renewed domestic slowdown” were factors in the low growth.
Economists have also called into question Trump’s argument that China pays for the tariffs.
An IMF study released in May showed that the tariff revenue collection “has been borne almost entirely” by US importers.
Gregory Daco, chief US economist at Oxford Economics, said in May that “the higher prices on the import side” are “passed on to consumers or to businesses via higher input costs or via final goods that are more expensive”.
“In both cases those tend to hurt the US economy and not the Chinese economy,” he said.
While there is evidence that US companies are looking to leave China, this is largely due to rising labour costs, economists have said.