China’s GDP growth in Q3 2024 reached 4.6%, falling short of the 5% target. This may prompt the central government to take a more active role in boosting domestic demand.
Signs of recovery in consumption
Retail sales on the rise
Positive trends are emerging in consumption. In September, retail sales grew by 3.2%, compared to 2.1% in August. This momentum continued with the recovery in the real estate market in October and improved sales in home appliances and furniture.
Industrial production remains strong
Meanwhile, industrial production remains robust, with a 5.4% increase in added value recorded in September. Additionally, the PMI index for purchasing managers rose to 50.1, indicating slight expansion in manufacturing activities.
Key players in China’s economy
Midea’s market expansion
The multinational Midea reported significant revenue growth, driven by its increasing domestic market share and strong exports.
Trip.com’s acceleration
Tourism giant Trip.com is capitalizing on the growing interest of Chinese consumers in travel, demonstrating remarkable momentum.
Future challenges for China’s economy
Despite positive signals, China faces challenges such as slowing aggregate demand and declining real estate prices. Although the government has tools to stimulate the economy, it has taken a cautious approach so far. However, since late September, a shift towards more proactive measures indicates support for domestic demand, fostering growth prospects for 2025.
Conclusion
China is undergoing a transformation into a high-value-added economy, as evidenced by its export and industrial production structure. While challenges remain, the government’s new strategy may solidify recovery signals and pave the way for a more stable future.
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