In 2024, China’s economy demonstrated remarkable resilience and potential, achieving a 5% annual growth rate despite facing global economic challenges. Under the dual circulation strategy, which emphasizes both domestic and international economic flows, China not only met its growth target but also made substantial progress towards high-quality development.
On the domestic front, China implemented a series of policy measures to stimulate the recovery of its market. Recognizing the importance of domestic consumption, the government increased incomes for low- and middle-income groups, enhanced consumption capacity, and expanded service consumption. These efforts bore fruit, especially in the fourth quarter, where incentives led to a mild rebound in domestic demand.
In terms of external demand, China’s export market maintained strong resilience. Exports grew by 7.1% year-on-year, bolstered by the country’s pivotal position in the global industrial chain. Foreign trade continued to contribute significantly to the economy’s development.
Looking ahead to 2025, however, China’s export market is expected to face greater challenges. With global economic growth projected to slow down, demand for Chinese goods may decrease. Moreover, tariff measures imposed by the European Union and the United States on China’s semiconductors, electric vehicles, and solar panels are set to take full effect, potentially impacting exports significantly. The possibility of new tariff measures from the upcoming U.S. administration adds further uncertainty.
Despite these challenges, China made notable progress in industrial upgrading and transitioning from old to new drivers of growth in 2024. While traditional industries like real estate, steel, and textiles showed signs of stagnation, emerging sectors such as semiconductors, smartphones, shipbuilding, drones, electric vehicles, and new energy industries sustained strong growth momentum. This indicates progress in industrial restructuring and transformation.
Acknowledging that the transition is not without imperfections—traditional industries still hold a significant share of the economy, and emerging industries face challenges like technological bottlenecks and low market recognition—China remains committed to advancing its industrial transformation.
In 2025, China’s primary economic focus will be on significantly boosting consumption, improving investment efficiency, and comprehensively expanding domestic demand. The central government plans to implement targeted consumption-boosting actions, raise incomes, reduce burdens for low- and middle-income groups, and continue expanding initiatives in new energy and consumption sectors. By innovating diverse consumption scenarios and expanding service consumption—particularly in cultural and tourism sectors—the government aims to further develop the domestic market and upgrade consumption patterns.
As household incomes rise and consumption evolves, the domestic market is set to become an increasingly vital pillar of China’s economy. Improving investment efficiency and optimizing investment structures will also play crucial roles in stimulating economic growth.
Overall, China’s economy in 2024 showcased resilience and adaptability amidst global uncertainties. By focusing on domestic consumption and industrial transformation, China is poised to navigate the challenges ahead and continue its progress towards high-quality development.
Reference(s):
China's economy achieves 5% growth in 2024 amidst dual circulation
cgtn.com
