China’s economy grew by 6.7% in 2016, the slowest rate for 26 years, dragged down by the worst trade slump since 2009.

The world’s largest trading nation’s exports fell by 7.7% in 2016, with imports down 5.5%. This marks the second consecutive annual decline in trade value, and the worst since the financial crisis.

Amid fears over a trade war with the US, analysts aren’t expecting an immediate rebound in trade growth, however promised stimulus from the Chinese government may help boost GDP growth through 2017.

Perhaps aligned to this stimulus, or at least anticipating it, 2016 marked a record year for China’s imports of crude oil and iron ore, while coal imports expanded for the first time in three years. Furthermore, the growth in domestic demand for steel and aluminium sent exports of these commodities down.

Indeed, the fiscal stimulus made 2016 the biggest year of lending on record for China’s banks. Chinese banks lent US$1.82tn last year, sparking fears that the stimulus would create an asset bubble in China. The figure was 8% more than the previous record, which came after the financial crisis in 2009.

That said, construction and manufacturing is contributing less to China’s growth than it has traditionally.

“Based on the National Bureau of Statistics’ breakdown of Q4 GDP growth, we estimate that the service sector continued to underpin real GDP growth. The contributions from industry, construction and financial services sectors fell,” says Yang Zhao, an economist in Nomura’s research team.

It’s worth pointing out that while the GDP figures will be viewed as disappointing, they fall within the Chinese government’s target growth levels of 6.5% to 7%. However, it must also be acknowledged that the figures are being greeted with much scepticism in the light of a data-rigging scandal in the Liaoning province.

Local authorities admitted to inflating GDP growth figures for the region from 2011 to 2014. Governor Chen Qiufa admitted fabricating data in his annual report, saying fiscal revenues were inflated by 20%. This marks the first time an official has admitted fixing data, on the record.

For years, doubts have existed about the veracity of China’s economic data. Many analysts believe that the official figures routinely add a number of percentage points on to the real growth levels. Despite the head of the National Bureau of Statistics Ning Jizhe saying that the national data are reliable, events in Liaoning are unlikely to convince sceptics.

Julian Evans-Pritchard, China economist at Capital Economics, points out that the 0.1% increase in GDP growth in the final quarter of 2016 meant that China avoided identical growth figures for four successive quarters, “which would have been a first for major economy in modern times and would have further weakened the credibility of the data. The figures have still been met with scepticism.”

He continues: “For our part, we actually think that China’s economy is currently expanding at close to the official rate – our China Activity Proxy (CAP) points to growth of around 6.4% year-on-year last quarter. However, this is only because the economy has recently experienced a sharp recovery from a downturn that was never properly acknowledged by the GDP figures.”

Meanwhile, China’s outbound investments in the final quarter of 2016 were the highest since 2008, according to data from merchant bank Grison’s Peak. Outbound investments grew 206% on quarter three to US$196bn, led by a huge surge in government to government (G2G) agreements.

The Chinese government issued 22 confirmed loans with an aggregate value of US$24.7bn. There were 19 policy bank loans, and G2G agreements worth US$114bn in pledged amounts.

These G2G agreements were largely with Bangladesh, Malaysia, the Philippines, Pakistan and the Central Eastern Europe region. US$37.5bn was pledged to the government of Bangladesh, US$32.7bn to Malaysia, and US$24bn to the Philippines.

Grison’s Peak also remarks on the ratio of delivery to pledged capital by the Chinese government as being higher than expected.

“While many countries discuss infrastructure build and spend, China does what is says on the tin. This quarter, the company China Road and Bridge (CRBC) alone – saw the opening of the Capital Airport Expressway linking the capital of Madagascar to the Ivato international airport opening a 172km toll road in Northeast Cambodia and performed emergency repairs to 60km of the trunk road in the Togo Coastal Area Eastern part which extends to the border of Benin,” says a note accompanying the figures.