China domestic stimulus and exports to spur 5% growth

Significance

The property crisis is at the heart of the slowdown, creating spillovers to almost all other sectors. Pressure is building on the government to implement more stimulus or risk missing the 5% growth target.

Impacts

• The government faces pressure to stabilise the property crisis and enact reforms, but the Third Plenum meeting outcomes were disappointing.
• Domestic and external demand are trending in opposite directions, with imports contracting but exports gaining strength.
• Export growth will be resilient into 2025, helping keep headline growth near 5%, but it will slow thereafter, weakening broader GDP growth.
• The authorities will seek new growth drivers to replace property; emerging technologies will be key but will be hit by trade tensions.