<strong>By:</strong> <strong>Momentum Investments Economist</strong>, <strong>Sanisha Packirisamy</strong>

<img class="alignright wp-image-35786 size-medium" src="https://www.cover.co.za/wp-content/uploads/2015/10/Economy-Sanisha-Packirisamy-200x300.jpg" alt="Photo of Sanisha Packirisamy" width="200" height="300" />China's 2018 economic growth fell to a three-decade low, according to official data released yesterday. As the world’s second largest economy this has far reaching effects – once of which is its contribution to the International Monetary Fund (IMF) decision to revise its global growth outlook for 2019 by 0.2%.

<h3>Below you will find commentary from <strong>Momentum Investments Economist</strong>, <strong>Sanisha Packirisamy</strong>, on the growth slowdown in China and implications for South Africa:</h3>

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<li>Activity in manufacturing, exports and the property market is slowing in China. Momentum Investments expects Chinese growth to slow to 6.2% in 2019.</li><li>Chinese authorities are unlikely to engage in a large-scale stimulus plan as they remain committed to deleveraging the economy from elevated debt levels. As such, a target stimulus response to prop up the economy is underway.</li><li>Growth in China is becoming increasingly reliant on consumption and moving away from commodity-intensive investment. 80% of growth in gross domestic product (GDP) came from consumption in China in the fourth quarter of the year, which is up from 35% in 2003.</li><li>With the Chinese economy rebalancing towards consumption-led growth, its reliance on the commodities that SA produces will slow. This will be negative for SA’s terms-of-trade (export prices relative to import prices), which could weigh negatively on the rand in the medium term.</li>

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