In 2025, China achieved its growth target of 5%, driven mainly by strong exports. However, official data for the final quarter of the year, released on Monday, show a noticeable slowdown in the world’s second-largest economy.
The 5% figure announced by the National Bureau of Statistics on Monday matches the target set by Chinese leaders at “around 5%”, following growth of 5% in 2024.
Nevertheless, this rate remains one of the weakest growth figures in decades, excluding the period of the COVID-19 pandemic. The figures for the fourth quarter of 2025 confirm a noticeable slowdown in domestic demand. The numbers indicate a decline in the final quarter of the year, with growth not exceeding 4.5%, which aligns with expert expectations.
Global Trade Tensions
It was noted that global trade tensions experienced last year were a factor, with emphasis placed on the strength of the Chinese economy, which allowed it to absorb shocks and record a growth rate among the highest of the major economic powers.
It was stated that “the Chinese economy advanced in 2025 despite pressures and achieved 5% growth amid intensifying negative external impacts,” adding, “This testifies to our resilience and vitality.”
However, one analysis firm pointed out in a note that “the official figures overstate the pace of economic growth by at least 1.5 percentage points.”
It explained that December data “suggest that production growth gained momentum at the end of the year, but this is largely due to the resilience of exports.” The Chinese economy still faces a series of challenges, most notably the prolonged stagnation in household consumption and the ongoing crisis in the real estate sector.
Retail sales are considered a key indicator of consumption
In this regard, it was mentioned that retail sales, considered a key indicator of consumption, rose in December by 0.9% year-on-year, their slowest pace in about three years, specifically since the lifting of COVID-19 restrictions. Industrial production, meanwhile, rose by 5.2% in the final month of the year, down from the 5.8% rate in 2024.
The analysis firm considered these figures to remain “good news,” noting that “external demand for Chinese products appears to be strengthening, as both export growth and industrial sales for export accelerated last month.”
