China’s economy demonstrated remarkable resilience in the first half of 2025, expanding by 5.3% year-on-year despite persistent global headwinds. The growth, 0.3 percentage points higher than 2024’s comparable period, reflects strategic policy adjustments and diversification efforts across key sectors.
Exports Lead the Charge
Defying trade tensions, China’s exports grew 7.2% in H1 2025, driven by surging shipments to Africa, India, ASEAN, and Central Asia. Mechanical and electrical products remained export mainstays, while progress in China-U.S. trade talks and shifting global tariff dynamics created new opportunities. Analysts predict this momentum could strengthen further in H2.
Domestic Consumption Gains Traction
Retail sales rose 5% year-on-year, boosted by 162 billion RMB in central government funding for trade-in programs. With an additional 138 billion RMB allocated for H2 initiatives, policies encouraging consumers to upgrade appliances and vehicles are expected to sustain growth through year-end.
High-Tech Sector Accelerates
Industrial output and technological innovation showed particular strength, with value-added production in high-tech manufacturing growing 8.3% – outpacing overall industrial growth. This aligns with China’s focus on quality development as policymakers prepare the 15th Five-Year Plan (2026-2030), set for discussion at October’s key CPC Central Committee meeting.
While global markets remain volatile, China’s diversified trade partnerships and targeted stimulus measures position it to navigate economic challenges while advancing long-term modernization goals.
