The Ministry of Commerce in Beijing said foreign direct investment plunged 8.7pc in July to $7.58bn (£4.82bn). Meanwhile China’s export market ground to a mere 1pc expansion from last year, rather than its traditional double-digit growth.
Shen Danyang, spokesman for the ministry told a press conference: “July’s dramatic decline in the growth rate of foreign trade, especially in exports, was mainly attributed to the big fall in exports to the European Union.”
Mr Shen added: “A decline in exports to the EU had been predicted, but the escalation and further deterioration of the EU debt crisis, and plummeting demand from EU countries, were outside of expectations.”
The data is another pointer to a worrying slow-down in the powerhouse economy which could hamper the global recovery. Western governments, particularly in the eurozone, have banked their hopes on a China-led recovery, both through trade and bond-buying programmes