China's Economy Meets Growth Target in 2024, but Challenges Remain

China's Economy Expands at 5% Pace in 2024

China's economy grew at a 5% annual pace in 2024, meeting the government's target of "around 5%" growth. This expansion was driven by strong exports and recent stimulus measures.

In the final quarter of the year, the economy grew by 5.4%. This growth was fueled by companies and consumers rushing to beat potential tariff hikes that incoming President-elect Donald Trump may impose on Chinese goods.

Despite this positive performance, the world's second-largest economy continues to face challenges. Weaker consumer spending and deflationary pressures have hampered its recovery from the COVID-19 pandemic. Additionally, the property sector, once a major driver of business activity, has experienced a downturn.

Looking ahead, economists predict that China's economic growth will slow further in the coming years. President-elect Trump has pledged to increase U.S. import duties on Chinese goods, which could further impact the country's economy.

In response to these challenges, the Chinese government has implemented a series of stimulus measures. These include reducing banks' reserve requirement ratios, cutting interest rates, and frontloading billions from its budget in 2025 to fund construction projects. The government has also ordered banks to lend to struggling property developers and expanded a trade-in scheme for consumer goods. Additionally, it has raised the wages of millions of government workers to revive domestic demand.