Three reasons Trump tariffs aren't China's only problem

[...]

1. Tariffs are already hurting Chinese exports

There is a growing chorus of warnings that China's economy will slow in 2025. One major driving factor of last year's growth is now at risk: exports.

China has relied on manufacturing to help exit the slowdown - so, it has been exporting a record number of electric vehicles, 3D printers and industrial robots.

The US, Canada and the European Union have accused China of making too many goods and imposed tariffs on Chinese imports to protect domestic jobs and businesses.

[...]

2. People are just not spending enough

In China, household wealth is largely invested in the property market. Before the real estate crisis, it accounted for almost a third of China's economy - employing millions of people, from builders and developers to cement producers and interior designers. [...]

It's already hit spending hard - in the last three months of 2024, household consumption contributed just 29% to China's economic activity, down from 59% before the pandemic.

That is one of the reasons Beijing has stepped up exports. It wants to help offset sluggish domestic spending on new cars, luxury items and almost everything else.

[...]

3. Businesses are not flocking to China like they used to

The lacklustre economic picture, uncertainty over tariffs and other geopolitical uncertainties mean the appetite of foreign businesses for investment in China is subdued.

It's not about foreign or domestic investment - it's that businesses don't see a bright future, said Stephanie Leung from wealth management platform StashAway.

"They would like to see a more diversified set of investors coming in."

[...]