China: Solid growth, but with challenges in sight.
China exceeds growth expectations in 2024 but faces significant challenges.
In 2024, China’s economy achieved a 5.0% growth rate, meeting the official target. However, this performance—its weakest since 1990, excluding the pandemic years—reflects an economy heavily reliant on fiscal and monetary stimulus. Key highlights include:
- Inflation: Increased by only 0.2%, signaling weak domestic demand.
- Industrial production: Grew 5.8%, led by high-tech sectors (+8.9%).
- Real estate: Declined 10.6%, highlighting weakness in the sector.
- Demographics: Population decreased 1.39 million, exacerbating the aging challenge.
- International trade: Exports grew 7.1%, and imports 2.3%.
- Unemployment: Urban unemployment rate remained stable at 5.1%.
Despite these figures, China’s economy continues to face significant pressures, including weak domestic consumption, a persistent real estate crisis, and ongoing trade tensions with the U.S. Analysts anticipate that the government will announce new stimulus measures, although fiscal and monetary policy options are increasingly constrained.
We will closely monitor the growth target China sets in the near future and assess the impact of its measures on the global economy.
Annual and quarterly GDP evolution
- oya: Refers to year-over-year variation.
- Q/Q: Refers to quarter-over-quarter variation.
Source: JP Morgan
