03.08.2026, 10:28
Russia's largest trading partner is facing a problem
Source: OREANDA-NEWS
OREANDA-NEWS At the beginning of the third quarter of 2026, the Chinese economy faced a problem — business activity declined in both the manufacturing and service sectors. This is reported by Kommersant with reference to data from the National Bureau of Statistics of the People's Republic of China.
In July, the purchasing managers' index (PMI) in manufacturing fell to its lowest level in the last five months, dropping to 49.2 points. Values below the 50-point mark indicate a contraction in activity.
The negative dynamics also affected the service and construction sectors. In these segments, the PMI dropped to its lowest level since December 2022, dropping to 49.3 points. Analysts also recorded a decrease in the index in other important sectors of the Chinese economy. Thus, in the high-tech manufacturing sector, the PMI fell to 53.3 points. The indicator of business activity of companies producing consumer goods, in turn, decreased to 47.8 points.
Against the background of the deteriorating state of the Chinese economy, reaching compromises with the United States and the European Union is becoming increasingly important for the authorities of the Asian country, which remains Russia's largest trading partner. The latter account for a significant part of China's foreign trade. In the case of Washington, we may be talking about a large-scale deal. The parties have already begun discussing the prospects for mutual reduction of duties on goods with a total value of about $ 30 billion.
As for economic relations with Europe, the option of point compromises seems more realistic here. In negotiations with the EU authorities, China continues to insist on the need to reduce duties on electric vehicles. In return, China offers the bloc to increase investments in local production. However, a number of experts are skeptical about the prospects of achieving such a deal. Recently, predictions about the beginning of a full-fledged trade war between Beijing and Brussels have become more frequent in the world. Given Europe's own economic problems, the influx of cheap Chinese goods is a serious threat, analysts said.
In July, the purchasing managers' index (PMI) in manufacturing fell to its lowest level in the last five months, dropping to 49.2 points. Values below the 50-point mark indicate a contraction in activity.
The negative dynamics also affected the service and construction sectors. In these segments, the PMI dropped to its lowest level since December 2022, dropping to 49.3 points. Analysts also recorded a decrease in the index in other important sectors of the Chinese economy. Thus, in the high-tech manufacturing sector, the PMI fell to 53.3 points. The indicator of business activity of companies producing consumer goods, in turn, decreased to 47.8 points.
Against the background of the deteriorating state of the Chinese economy, reaching compromises with the United States and the European Union is becoming increasingly important for the authorities of the Asian country, which remains Russia's largest trading partner. The latter account for a significant part of China's foreign trade. In the case of Washington, we may be talking about a large-scale deal. The parties have already begun discussing the prospects for mutual reduction of duties on goods with a total value of about $ 30 billion.
As for economic relations with Europe, the option of point compromises seems more realistic here. In negotiations with the EU authorities, China continues to insist on the need to reduce duties on electric vehicles. In return, China offers the bloc to increase investments in local production. However, a number of experts are skeptical about the prospects of achieving such a deal. Recently, predictions about the beginning of a full-fledged trade war between Beijing and Brussels have become more frequent in the world. Given Europe's own economic problems, the influx of cheap Chinese goods is a serious threat, analysts said.
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