China benefits from export rush ahead of tariff blitz, economy beats expectations
Container ships are seen at the port in Qingdao, in Chinas eastern Shandong province on April 15, 2025. (AFP Photo)
China’s economy grew faster than expected in the first quarter of 2025, with gross domestic product (GDP) expanding by 5.4% year-over-year, driven by a preliminary boom in investments and a surge in exports ahead of steep U.S. tariff hikes, according to official data released Wednesday.
This figure outpaced market expectations of 5.1%, partly due to a 12.3% surge in March exports, as Chinese firms accelerated shipments ahead of new U.S. tariffs announced on April 2. The trade dispute between Washington and Beijing has intensified in recent weeks, with U.S. tariffs on Chinese imports rising to as high as 145%, prompting China to retaliate with 125% duties on American goods.
Industrial production also posted solid gains, rising 6.5% in the first quarter compared to 5.7% in the previous quarter. Meanwhile, retail sales—a key indicator of consumer activity—grew 4.6% annually, reflecting Beijing’s ongoing efforts to stimulate spending after years of sluggish consumption.
Slowing performance persists, calls for ‘proactive’ measures
China, the world’s second-largest economy, has been grappling with a slow recovery following the pandemic, as the rapid double-digit growth that once defined its rise has faded.
Despite the upbeat figures, officials acknowledged persistent economic headwinds. “The current external environment is becoming more complex and severe,” said National Bureau of Statistics (NBS) Deputy Commissioner Sheng Laiyun, warning that high U.S. tariffs are placing “certain pressures” on foreign trade.
He added, however, that long-term prospects remain positive as China continues to roll out supportive policies. Over the past year, Beijing has lowered interest rates, eased property market restrictions, raised local government borrowing limits, and expanded financial support to stabilize growth.
Still, the NBS noted that the recovery remains fragile and called for “proactive and effective” macroeconomic policies to reinforce momentum in the coming quarters. “The foundation for sustained economic recovery and growth is yet to be consolidated,” the NBS said.
