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China's economy: A fragile facade?
16 Mar
Summary
- Official GDP growth for 2025 was 5%, but real growth estimated between 2.5-3%.
- Property sector decline continues, with 80 million unsold housing units.
- Youth unemployment at 16.9% as population declines for fourth year.
China's official GDP growth for 2025 reached 5%, aligning with Beijing's target. However, independent analyses suggest actual growth may have been significantly lower, between 2.5% and 3%. This disparity highlights underlying economic weaknesses.
The nation's crucial property sector has been in decline since 2021, resulting in an estimated 80 million unsold housing units. This downturn impacts local government finances, which heavily rely on land sales.
Economic pressures are compounded by deflationary trends, with producer prices falling significantly and consumer price inflation remaining subdued for three consecutive years. Weak domestic demand, evidenced by modest retail sales growth of 3.7% in 2025, persists.
