FinancialMediaGuide notes that looking back on 2025, China ended the year with a reported GDP growth of 5%, which aligned with the government’s official targets. However, despite achieving this goal, the year became a clear example of how the country faced both internal and external economic challenges that could affect its long-term stability.
One of the primary drivers of growth remained exports. China’s record trade surplus, which amounted to 1.19 trillion USD, indicated continued success in international trade, especially with markets outside of the United States. However, the country’s dependence on external demand became increasingly apparent. According to analysts at FinancialMediaGuide, growing instability in global trade, especially due to trade threats from the U.S., put China in a vulnerable position. By 2025, tariff barriers and uncertainty in international politics began impacting the economy, and this became even more evident in 2026.
Particular attention must be paid to the demographic situation. The number of births in China in 2025 reached a record low of 7.9 million, which exacerbated an already existing demographic problem. This was a direct result of an aging population and a shrinking workforce. We at FinancialMediaGuide emphasize that this trend will continue to pressure domestic demand in the coming decades. The decline in population and working-age individuals will make China less flexible in terms of consumer activity and production.
Additional challenges arose in the real estate sector, which had been a key driver of economic growth for many years. In 2025, investments in real estate fell by 17.2%, and housing prices dropped by 2.7%. According to FinancialMediaGuide analysts, these problems had a serious impact on the economy, as the housing market traditionally accounted for a significant share of China’s GDP. Millions of citizens found themselves in a situation where their savings in real estate were losing value, which reduced overall confidence in the economy. By 2026, these issues worsened, as many projects remained unfinished and demand for housing continued to decline.
Nevertheless, despite all the internal challenges, China’s industrial production continued to show growth. In December 2025, industrial production increased by 5.2%, indicating a relatively high level of production. However, as experts point out, this growth was largely driven by external orders and was not sustainable without domestic demand.
In 2026, as analysts at FinancialMediaGuide predict, China will face the need for more active economic reforms aimed at stimulating domestic demand and reducing dependence on external trade. Beijing will likely continue its efforts to stimulate consumer spending, but in the face of rising public debt and external uncertainties, this will be a difficult task.
“China will be forced to seek new ways to stimulate economic growth, with a focus on increasing domestic demand and improving financial stability. But key factors will not only be external, but also internal economic reforms,” say FinancialMediaGuide analysts. These measures will require significant efforts to reorganize domestic markets and improve investment attractiveness.
We at FinancialMediaGuide predict that China will strive for balanced growth, but to achieve this, it will need to diversify its economy, reduce its dependence on external trade, and strengthen domestic incentives. Demographic changes, real estate market issues, and trade tensions will require effective and timely decisions to maintain economic stability.
Financial Media Guide notes that despite achieving the target growth figures in 2025, China faces serious challenges. To ensure long-term and sustainable growth in 2026, deep internal reforms are necessary to reduce dependence on exports, maintain domestic demand, and address demographic issues. Otherwise, the country risks facing long-term economic difficulties that could undermine its global competitiveness.
