China’s Economic Outlook for 2025: Improvement Amid Ongoing Challenges
China’s economy is improving in 2025, but faces challenges including U.S. tariffs, weak domestic demand, and a declining real estate market. Despite some positive trends in real estate pricing, continued policy support is essential.
China’s economy has shown signs of improvement at the beginning of 2025, yet significant challenges persist. A spokesperson from the statistics bureau acknowledged that while the economy is progressing positively, both domestic and international factors continue to hinder growth. The imposition of a 20% tariff by U.S. President Donald Trump on Chinese imports poses a risk to China’s export-driven economy.
Fu Linghui, at a recent news conference, highlighted that the external economic landscape is increasingly complex and adverse. He noted that domestic demand remains inadequate, causing difficulties for several companies in terms of production and operations. Furthermore, the foundation for sustained economic recovery remains shaky.
Additionally, China’s prolonged real estate crisis is contributing to diminished consumer confidence and spending. According to the statistics bureau, real estate investment dropped by 9.8% during the first two months of the year. Although real estate prices continue to decline, the rate of decrease has slowed compared to the previous year.
Forecasts from ING bank suggest that while a halt in price drops may occur this year, a rapid rebound in real estate values is unlikely. Lynn Song, the chief Greater China economist at ING, emphasized the necessity for continued policy support, stating that “February’s data showed that it would be wise for officials not to take their foot off the pedal in terms of policy support.”
In summary, while China’s economy is exhibiting signs of improvement in early 2025, it faces considerable challenges due to tariffs, insufficient domestic demand, and a persistent real estate crisis. Experts suggest that continued support is essential to stabilize and promote economic recovery amidst these adversities.
Original Source: m.economictimes.com
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