The state of China’s economy in 5 numbers

Not so long ago, professional baseball changed. A new type of technocratic team manager took over who eschewed distractions like a player’s speed or bulging biceps, and focused instead on their raw numbers. The impacts of that shift have since spread far and wide. Writing up an effective scouting report on China’s economy might benefit from a similar approach.

What can a handful of figures tell us?

In a changing world, some point to the basic outline of an economy that doesn’t appear to be changing much. Simply becoming bigger and even more self-sufficient. It’s still clearly “export-led,” meaning China sells far more stuff to the world than it buys – about $1.2 trillion more last year alone, to be exact.

And if you’ll recall, though it may seem long ago, 2025 was a funny year for trade. Traditional patterns had to be remixed as the US went on a tariff blitz. But China simply sold more to other countries in Asia even as it sold less to the US. Its monthly export numbers keep growing faster than most experts have anticipated.

There is change in the air, though – even if the practical reality on the ground in the Strait of Hormuz seems to stagnate. The vital trade corridor’s effective closure has trained even more of the world’s attention on things China specializes in, like green energy and modes of transportation that don’t depend on a tanker laden with oil to transit a war zone.

In a few weeks, participants will descend on Dalian, China for “Summer Davos.” Government officials, corporate decision-makers, and academics will try to gain the clearest possible view of a global economy with China increasingly at its centre.

Five numbers in particular might help frame those discussions.

In the first month after the Strait of Hormuz was closed, China shipped out enough solar energy capacity to power up the entire UK for a cold, dreary night.

Those record export figures in March were due in part to a glut of orders ahead of the expiration of export-tax rebates. But they were followed by April numbers that weren’t all that far behind – just as strongly suggesting a world eager to stock up on a more reliable green energy supply.

China is still the go-to provider of that particular supply, bar none.

With the Strait of Hormuz effectively closed, developing countries particularly reliant on oil and gas imports were the first in line for Chinese solar panels, wafers and cells. Exports to India nearly doubled in March compared with a year earlier, to 11.3 gigawatts, according to the energy think tank Ember. Exports to Africa jumped five-fold during that same interval to nearly 10 gigawatts, while those to Asia overall nearly doubled to 39 gigawatts.

The European Union’s imports of Chinese solar products had already more than tripled between 2014 and 2024, to €11 billion annually. The region will surely need much more from China, though experts there have started sounding an alarm about over-reliance. It’s not the only place where those concerns are being raised.

Will China’s solar boom last, even after global trade in hydrocarbons is fully restored?

That’s the high end of China’s own estimate for its GDP growth this year. It calls for a bit of context.

By the standard it set in recent decades, 5% might seem downright modest. Even a bit underwhelming. After all, in the 20 years between 1990 and 2010, the country registered double-digit annual growth 11 times. The highest mark hit by the US in the past half-century is 7.2% -- during a recovery after the malaise of the 1970s.

Much of the economic activity reported by the US currently depends on people and companies buying things from China (yes, still). And not a small amount relies on selling things to China, like oil and soybeans.

But it might be more instructive to compare China to its primary foil in terms of fast-growing, large economies: India. While China averaged 8.7% annual growth between 2000 and 2020, India averaged 5.9% (Germany, Europe’s biggest economy, averaged 1.1%). However, India has outpaced China every year since.

The IMF projects that China’s GDP will grow by 4.4% this year, while India’s grows by 6.5%. Of course, GDP isn’t everything. For some experts, it doesn’t really reflect much of what’s truly important about the way an economy is experienced.

Still, many of the people living in China, India, the US, or Germany are probably at least vaguely aware of this official economic score for their country. And they may put a lot of store in that number, for better or worse.

That’s the price tag for the most popular Chinese electric car available in Mexico: the BYD Dolphin Mini.

Electric cars from China are seemingly on the market just about everywhere now. After all, BYD has surpassed US-based Tesla as the world’s biggest seller. But Mexico makes for an interesting case study, due to a dramatic recent spike in the popularity of Chinese vehicles there and its proximity to one particular market where they’re not yet for sale.

China’s electric cars are effectively banned in the US, even as Chinese auto parts suppliers proliferate in the country. According to a recent news report, however, more Americans living close enough to Mexico to regularly see Chinese electric cars motoring in to deliver people to work or school north of the border are wondering why they can’t buy one, too.

A BYD Dolphin Mini sold in the US close to that Mexican price point would make it about 38% cheaper than the cheapest domestic electric model. Those Texans eyeing far snazzier BYDs might not be aware that they’re in some ways just the tip of an EV iceberg. There are more than 100 electric-car brands in China, which may be whittled to a mere 15 by 2030 – a result of the same kind of massive industrial-policy effort that has the country churning out solar panels and rare earths.

In Europe, where electric car sales increased by more than 30% last year, EU efforts to protect local carmakers by hitting Chinese models with tariffs have proven largely ineffective. Other places eyeing more imports from China also may have to weigh a desire to shelter domestic car companies against the economic and climate benefits that Chinese versions present.

That was the increase in value of China’s overall exports in April compared with the same month a year earlier – despite the major trade glitch triggered in the Strait of Hormuz, and despite the new era of US tariffs.

There were plenty of electric cars and solar panels among those exports, of course, alongside the batteries needed for EVs, wind turbines, and semiconductors to feed the global AI boom.

The country’s exports to the US increased by 11% in April, as its imports from the US rose by just 9%. It seems the dream of rebalancing trade in America’s favour through a tariff barrage remains elusive. In some ways this new-ish regime may even be backfiring; African countries confronted with the tariffs have been finding China eager to buy their goods, and bolster its own influence on the continent.

The US has plenty of company when it comes to running a trade deficit with China. Meanwhile the list of those actually exporting more to China than they import remains very short (it helps to have an abundance of iron ore, gold, and oil to offer up, like Australia).

There are some structural reasons for China’s export dominance, like the barriers erected around its domestic market and its subsidies. That’s incurred criticism from some of the same countries now liable to pursue similar strategies of their own.

One traditional Chinese export that has not thrived recently: sulphuric acid, which normally relies on sulphur imports from the Middle East. Even the factory to the world is not immune to the impacts of a once-in-a-generation supply shock.

Now for the not-so-positive flip side of those thriving exports. This number represents what people are buying within China – it’s the country’s domestic retail sales growth in April, the weakest monthly figure recorded since 2022.

By way of context, domestic sales growth hit 18.4% in April 2023, which was nonetheless short of expectations because the country was just then emerging from pandemic-induced stasis. The figure was still 10% in November of that year, and nearly 3% as recently as February of this year.

In the US, which increasingly relies on the consumption of the wealthiest people there to propel economic growth, consumer spending has also been lacklustre lately. Europe has likewise experienced a pullback.

There’s a litany of frequently-cited reasons for the continued lack of consumer appetite in China, where per capita wealth has accelerated 15-fold in the first part of this century. One of the causes cited for the April slowdown was the diminishing impact of “trade-in” programmes designed to address this structural shortcoming.

A prominent historical cause of meagre domestic spending in China has been a relatively meagre social-safety net. That’s prompted people to actively stash away more money for probable use at a later date, which has been dubbed the problem of precautionary savings.

Chinese households also may not countenance debt in quite the same way as people do in some other countries. These households have actually been reducing what they borrow lately, not extending themselves to make bigger-ticket purchases.

An ongoing property slump has not helped. Many people in China who did make a big-ticket purchase to acquire a home have watched its resale value sink. That has dampened the general appetite for splashing out on nonessentials.