China’s economy expanded five per cent in 2025, one of its slowest rates of growth in decades as it struggles with persistently low consumer spending and a debt crisis in its property sector, Beijing said on Monday.
Leaders set a growth target of "around five per cent" for last year, following a five per cent rise in 2024.
The economy grew at 4.5 per cent between October and December last year, in line with expectations but marking a significant slowdown towards the end of the year.
While China’s GDP grew enough for officials to declare victory, analysts warn that growth has been uneven and figures mask weak sentiment on the ground.
Chinese consumers remain jittery about the wider economy and high unemployment, even though officials have relaxed fiscal policy and subsidised the replacement of household items in a sputtering bid to boost spending.
Retail sales, a key indicator of consumption, rose 0.9 per cent year-on-year in December -- the weakest pace since the end of 2022, when stringent zero-Covid measures ended.
Last month’s sales were worse than the 1.3 per cent year-on-year growth recorded in November, extending a months-long slowdown.
China’s crucial property sector was once a major indicator of the country’s economic strength.
But in recent years it has failed to overcome a flagging debt crisis despite rate cuts and loosened restrictions on homebuying.
Fixed-asset investments in China shrunk 3.8 per cent year-on-year in 2025, an inevitable rebalancing following a property and infrastructure boom in recent decades.
Real estate investment was down 17.2 per cent last year.
House prices have risen slightly in some large cities but the broader market remains sluggish.
Last year also saw the return of Donald Trump to the White House and the revival of a fierce trade war between the world’s two largest economies.
Chinese President Xi Jinping and US President Trump reached a tentative truce to their fierce trade war when they met in late October, agreeing a pause to painful measures that included lofty tit-for-tat tariffs.
Official data showed Chinese exports to the US plunged by 20 per cent in 2025, but that had little impact on demand for Chinese products elsewhere.
Robust exports remained a bright spot in the cloudy economic picture despite that bruising trade war.
China’s trade surplus hit a record $1.2 trillion last year, with officials lauding a “new historical high” filled by other trade partners.
Shipments to the ASEAN group of Southeast Asian nations rose 13.4 per cent year-on-year, while exports to Africa saw 25.8 per cent growth.
Exports to the European Union were also up 8.4 per cent, though imports from the bloc dipped.
