China recorded a 6.1 percent GDP growth for 2019. The number is basically in line with expectations, and slowdown stabilization may make investors more comfortable, according to Liang Hong, chief economist at the China International Capital Corporation (CICC), speaking with CGTN in an interview on Friday.

"I think what made investors more comfortable recently is the slowdown of the economy seems to be stabilizing. The November-December number, industrial production, investment number seems to be not just troughing but even showing some signs of recovery. That cyclical recovery path seems to have been maintained," she told CGTN. 

She also discussed the negative impact brought by the trade war with the U.S. "I guess, if you look at export growth in nominal U.S. dollar terms, the growth rate was close to zero. But in 2018, it was 9.9 percent. So, it's about a 10 percentage point decline in growth rate in current dollar terms. That should have a significant impact on nominal income growth," she said.

Aside from its impact on exports, Liang said it also negatively affected companies' Capital Expenditure (CAPEX) growth.  

"If you put them together, I would think it probably took off one to two percentage points in nominal growth in China. Some of that was countered by the Chinese countercyclical policy," she noted.  

The economist stressed for the first time, the main part of the countercyclical policy mix is tax cut, instead of infrastructure spending or monetary easing we've seen in the past.

Talking about the news that GDP per capita exceeded 10,000 U.S. dollars for the first time, Liang says China is likely to surpass the so-called middle-income trap.

"If we look forward one year, three year, five year horizon, it looks like China will continue to be able to grow at 6 percent or above in nominal terms,  she said.

"We have heard from the Chinese government, they seem to be still very determined to maintain a 6-percent, probably above, growth for this year and they are digging deeper structural reforms as well as countercyclical policy measures. So, putting that together, it looks like we're going to surpass that trap."

For China's economic outlook in 2020, she said the CICC has upgraded their forecast for growth and RMB.

"We're seeing the phase one deal with the U.S. has been signed. So, some of the headwinds the Chinese economy and global economy experienced last year, looks like that headwind is gone," Liang said. 

Based on Liang's words, the CICC projects that China's growth this year  will probably be 6 percent or slightly above“driven even just by a cyclical recovery by some restocking of the companies."

On renminbi (RMB) front, Liang said easing trade frictions should lead to stabilized capital flows, or even more inflows coming to China. Moreover, the opening-up of China's financial market as part of the phase one deal would accelerate foreign direct investment inflows to China in 2020.