The new logic of the Chinese economy, Pg8

Key Highlights:

• China's GDP exceeded 140 trillion yuan (approximately $20 trillion) in 2025, a 5% year-on-year increase.
• China's contribution to global economic growth is expected to reach around 30% in 2025.
• Final consumption expenditure contributed 52% to China's economic growth in 2025.
• High-tech product exports grew by as much as 13.2% in China throughout 2025.
• China-India trade reached a historic high of $155.6 billion in 2025, with India's exports to China reaching $19.7 billion.

Detailed Insights:

• In 2025, China's economic growth was driven by consumption, exports, and investment, with a shift towards domestic demand as the primary engine.
• Despite lower prices compared to the global average, China ranks among the world’s top countries in terms of total basic consumption, with high ownership of mobile phones and high average daily protein intake.
• China's exports demonstrated resilience, contributing 32.7% to economic growth, driven by the complete industrial chain and improving innovation capabilities, particularly in high-tech products.
• Gross capital formation contributed 15.3% to growth, indicating a transformation from investment and export reliance to a model led by domestic consumption and innovation.
• China's capacity utilisation rate of its above-designated-size industry stood at 74.4% in 2025, equivalent to that of the U.S. and the EU, indicating that there is no over production.
• China-India trade reached a historic high of $155.6 billion in 2025, demonstrating strong economic complementarity and cooperation potential between the two countries.
• China's tariff level remains low by international standards at 7.3%, and the country is expanding its visa-free policy and shortening the negative list for foreign investment access.

Key Concepts Involved:

• GDP (Gross Domestic Product): The total monetary or market value of all the finished goods and services produced within a country’s borders in a specific time period.
• Final Consumption Expenditure: The total value of goods and services that households, governments, and non-profit organizations purchase for their own use.
• Capacity Utilization Rate: The extent to which an enterprise or a nation actually uses its installed productive capacity.
• Trade Deficit: The amount by which the cost of a country's imports exceeds the value of its exports.