China's economy, the second biggest in the world, has grown at its slowest pace in three years as investment slows and demand falls in its own key markets such as the US and Europe.
The country's gross domestic product (GDP) conomy grew by 7.6% in the second quarter of this year, down from 8.1% in the previous three months.
In March, Beijing cut its growth target for the whole of 2012 to 7.5%, the BBC reports.
In 2011, China's economy grew by 9.2%, down from 2010's figure of 10.4% growth.
China accounts for about a fifth of the world's total economic output and any slowdown may hamper a global recovery
It is New Zealand's second-biggest trading partner, behind Australia but ahead of United States, Japan, Republic of Korea, and the Britain.
In addition to New Zealand, many of Asia's biggest and emerging economies have becoming increasingly reliant on China as a trading partner.
"China has been a big factor for the slowdown in Asia this year," said Tai Hui from Standard Chartered Bank in Singapore.
Difficult second half
If China's growth does not pick up in the second half of the year then "that's going to mean a very difficult second half for a lot of the manufacturers in this region," he says.
Despite Friday's slower growth figures many analysts tried to allay fears of a so-called hard landing in China's economy and its subsequent impact on the rest of the world.
As the world's largest exporter, China is being hard hit by the slowdown in Europe and elsewhere.
These are the country's worst figures since the start of the global financial crisis.
China's leaders are pinning their hopes on investment - especially in state companies - to drive growth in the world's second largest economy.
In recent weeks, they've twice cut interest rates to bolster lending. The authorities are also pumping money into public works - such as social housing. Fuel prices have also been reduced.
Many economists believe these measures will ensure that China's growth rebounds in the coming months.
But with a once-in-a-decade leadership change starting later this year - this is a sensitive time in Chinese politics. China's leaders will be deeply concerned that any further slowdown could lead to rising social unrest.
Social unrest a risk
"If you get a drop in the growth rate of 1 percentage point per annum, that's not a lot in terms of the world gross domestic product," Edmund Phelps, a professor of political economy at Columbia University and a Nobel prize winner, told the BBC.
He added that China had a lot of ammunition to counter the slowdown, some of which it has already started using because of the patchy recovery in the US, and the ongoing debt and economic issues in the eurozone.
China's central bank has cut the amount of money banks must keep in reserve in order to boost lending, and it recently cut the cost of borrowing twice in one month.
Earlier this week, Premier Wen Jiabao said that boosting investment would also be crucial for stabilising growth, fuelling expectation that more state-driven stimulus measures would be on the way.