China’s Economy Grows 5% in 2025 on Strong Exports

China closed 2025 with 5% economic growth, meeting its official target. Strong exports helped offset weak domestic demand, despite higher tariffs imposed by US President Donald Trump.

Growth, however, lost momentum toward the end of the year, slowing to 4.5% in the December quarter, the weakest pace since late 2022. The world’s second-largest economy had grown 4.8% in the previous quarter.

Exports remained the main support, driving a record trade surplus of $1.2 trillion. Even as consumer spending and business investment stayed subdued, this continued. While shipments to the US declined due to higher tariffs, exports to other regions helped cushion the impact.

Economists warned that reliance on exports may not be sustainable, especially as more countries consider raising tariffs on Chinese goods. China’s leaders have repeatedly stressed the need to boost domestic demand. Measures such as vehicle and appliance trade-in schemes have had only a limited impact so far.

The property sector remains a key drag, with analysts saying stabilisation—rather than a full recovery—is crucial to restoring household confidence and private investment.

Looking ahead, growth is expected to slow further in 2026, with forecasts around 4.5%. Beijing must balance external pressures, weak domestic demand, and its push for self-reliance in advanced technologies such as artificial intelligence.

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