Nearly two out of three provinces, regions and municipalities in China have downgraded their growth forecasts for this year even after trade tensions with the US have receded following the signing of the phase one deal recently. 22 leading provincial regions have reduced their growth targets in 2020 from the ones they had set in 2019.

Beijing, Shanghai and Guangdong now expect their GDP to grow at around 6% this year, from the 6-6.50% target they has estimated in 2019. Preliminary figures released so far reveal that around 11 provincial regions missed their 2019 growth targets due to the prolonged trade war and depressed domestic demand.

Overall economic growth forecasts for this year are also expected to be trimmed to around 6% nationwide. In addition to the easing of trade tensions, the government is hopeful that increased infrastructure spending could boost economic growth this year.