Manufacturing Drops In China Over Surging Tariffs And Global Slowdown

Chinas manufacturing sector contracted in April as tensions from a deepening trade war with the United States took their toll, according to official figures released on Wednesday. The government attributed the downturn to rapid changes in the global economy. US tariffs on Chinese goods surged as high as 145 percent this month, prompting Beijing to retaliate with its own duties of up to 125 percent on American imports. The economic fallout from these tit-for-tat measures is now starting to emerge.

Chinas Purchasing Managers Index PMI, a crucial gauge of industrial activity, slipped to 49 in April - below the threshold of 50 that distinguishes expansion from contraction. This marked a notable fall from March's figure of 50.5, which was the highest in a year, and lower than the 49.7 forecast by economists in a Bloomberg survey.

"The manufacturing PMI declined in April due to a high base effect from previous growth and significant changes in the global trade environment," said Zhao Qinghe, a statistician with the National Bureau of Statistics NBS.

Meanwhile, the services sector also lost momentum. The non-manufacturing PMI dipped slightly to 50.4 from 50.8 the previous month.

Economists have voiced concern that the escalating trade conflict between the US and China - two of the world's largest economies - could hamper business investment, raise consumer prices, and potentially trigger a global recession.