The economy China's economy is growing more slowly
China's economy grew more slowly at the end of last year. According to the statistics office in Beijing, gross domestic product increased by 4.5% year-on-year in the fourth quarter of 2025.
19.01.2026, 03:37
19.01.2026, 04:51
SDA
The world's second-largest economy thus recorded its weakest quarterly growth since the end of the coronavirus lockdown three years ago. In the three previous quarters, the economy had grown by 5.4%, 5.2% and 4.8%.
Statisticians reported growth of 5.0% for the year as a whole. This means that the government's target of "around five percent" was achieved. The economy was supported by foreign trade. Despite ongoing tensions with the USA and new trade policy uncertainties, Chinese companies benefited from strong exports to other regions.
Growth likely to weaken further
Economists see this as a sign of an unbalanced development. While the export boom is supporting the economy, a tight labor market and falling real estate prices are weighing on consumer sentiment. Added to this are the high debts of many local governments, which limit the scope for major economic stimulus programs.
This pattern is largely expected to continue in the current year. International organizations remain cautious. The World Bank expects growth of around 4.4% in 2026, while the International Monetary Fund is forecasting around 4.5%. The US investment bank Goldman Sachs is slightly more optimistic and expects growth of 4.8%. However, the basis for this is still primarily robust exports after Chinese companies expanded their sales markets outside the USA.
New five-year plan sets the course
At the same time, Goldman warns of ongoing structural problems. The development of a consumption- and service-driven economy will "take years, if not decades", wrote China chief economist Hui Shan in a recent analysis. In addition, the real estate sector has not yet reached a low point and a weak labor market continues to dampen household spending.
The new five-year plan for the period 2026 to 2030, which is to be adopted at the People's Congress in March, will point the way forward. The focus will be on technological innovations. The leadership around state and party leader Xi Jinping is pushing in particular for progress in semiconductors, artificial intelligence and advanced industrial production in order to further reduce dependence on foreign technology.
Consolidation complete?
Chinese economist Huang Weiping from the State People's University in Beijing was somewhat more optimistic. In his opinion, China's economy has been in a phase of consolidation after the strong pressure of recent years, which should now be largely complete. In addition, 2026 is the first year of the new five-year plan. The aim is to "get off to a good start and comprehensively develop strength".
