China’s economy grew 5% last year, meeting Beijing’s target but highlighting a widening gap in the country’s two-track economy.
While China’s export industries weathered US tariffs — Beijing’s trade surplus reached a record $1.2 trillion in 2025 — anemic domestic consumption and a faltering real estate sector weighed on growth.
The world’s second-biggest economy faces plenty of other challenges, too, including the threat of persistent deflation, elevated youth unemployment, and a huge and opaque pile of local-government debt.
The mixed figures “may be simultaneously too good and too bad to be true,” The Economist reported: Falling prices mean China’s nominal growth was lower than the reported figures, while “awful” investment numbers may have been skewed by past “statistical shenanigans.”
