NewKerala.com

China's Real GDP Growth May Be Half Official Target, Report Warns

A report indicates China's real economic growth for 2025 is likely only 2.5-3%, significantly lower than the government's stated 5% target. This gap is attributed to a collapse in property investment, negative fixed-asset investment, and prolonged producer-price deflation. Weak consumer spending and cautious behavior by households and firms point to a deeper economic malaise. The stark contrast with official data has amplified calls for greater transparency and robust statistical methodologies from Beijing.

Key Points: China's GDP Figures Overstated, True Growth Near 3%: Report

  • Real GDP growth far below official target
  • Sharp decline in property investment
  • Persistent producer-price deflation
  • Weak domestic demand
  • Stark data transparency issues
2 min read

China's overstated official GDP figures raise doubts about financial health: Report

Report reveals China's 2025 GDP growth likely 2.5-3%, far below official 5% target, raising doubts on data reliability and economic health.

"Combined with shrinking investment, these trends suggest that households and firms are increasingly cautious, an indicator of broader malaise beneath the surface. - Mizzima News Report"

Mumbai, Jan 16

China's real GDP growth in 2025 is expected to be at about 2.5-3 per cent, far below the government's stated target of around 5 per cent, raising critical questions about the true health of the world's second-largest economy, the reliability of official statistics, a report has said.

The report from Mizzima News said that the gap is driven mainly by a sharp decline in fixed assets and property investment, persistent producer‑price deflation, and enduring weakness in domestic demand, which could slow growth further in 2026.

It cited estimates of the US-based Rhodium Group's analysis and said Beijing's data for the first three quarters showed 5.2 per cent year‑on‑year expansion, which also stands in sharp contrast to the independent estimate.

The Rhodium Group predicted China's growth to slip to between 1-2.5 per cent, well below international projections such as those from the International Monetary Fund (IMF), which estimates around 4.5 percent growth next year.

The report highlighted that fixed‑asset investment turned negative by mid‑2025, and a collapse in property sector investment dragged down broader capital formation.

Producer prices have been in decline for more than three years, and consumer spending posted only marginal gains late in 2025, which indicated weak domestic demand, the report said.

While headline inflation in China showed a modest rise toward the end of the year, broader price data reflect enduring weakness in domestic demand and continued deflationary pressure at the producer level, the Myanmar-based media house said.

"Combined with shrinking investment, these trends suggest that households and firms are increasingly cautious, an indicator of broader malaise beneath the surface," the report said.

The report said that stark divergence between independent estimates and official figures has amplified calls for transparency and robust statistical methodologies.

Critics argued that the official narrative may overlook these gaps, particularly during periods when leaders are under pressure to maintain confidence and project economic stability.

"While foreign trade has helped sustain the headline numbers, reliance on external demand exposes domestic vulnerabilities and raises questions about the sustainability of growth," it noted.

- IANS

Share this article:

Reader Comments

P
Priya S
Not surprising at all. Many of us in the business community have long been skeptical of their official numbers. The property sector collapse was bound to show the real picture. Hope Indian policymakers are watching this closely.
R
Rohit P
The gap between 5% claimed and 2.5% real is huge! 🤯 This shows why we need multiple independent agencies to verify growth data. It affects global markets and countries like India that trade with them.
S
Sarah B
While the focus is on China, let's not get too comfortable. India's growth story is promising, but we also have sectors facing challenges. The key takeaway is sustainable, demand-driven growth, not just headline numbers.
V
Vikram M
Producer price deflation for 3 years is a massive red flag. It points to deep structural issues. India's manufacturing push ('Make in India') needs to ensure we build resilient domestic demand to avoid such traps.
K
Karthik V
Respectfully, while this report raises valid points, we should be cautious about Western analyses of China too. There's often a geopolitical angle. The truth probably lies somewhere in between the official and independent figures.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

Leave a Comment

Minimum 50 characters 0/50