With a shrinking population, China needs new drivers of growth. Consumer spending has yet to fill the gap

By Xiujian Peng, Senior Research Fellow, Centre of Policy Studies, Victoria University
James Giesecke, Professor, Centre of Policy Studies and the Impact Project, Victoria University

China’s latest national accounts show the economy grew by about 5% through 2025 and into the first quarter of 2026, pointing to resilience despite ongoing trade tensions.

But the underlying picture is weaker: growth slowed last year and, while it has stabilised, it remains below pre-COVID levels.

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