China’s Economic Growth Slows to Yearly Low, Fourth Plenum Focuses on High-Quality Development

 

Beijing, October 22, 2025 – Amid escalating U.S.-China trade tensions, China’s economic growth slowed to 4.8% in the third quarter, marking the lowest in a year. This has cast a sense of urgency over the ongoing Fourth Plenary Session of the 20th Central Committee in Beijing, where leaders are deliberating the next five-year plan to shift the economy toward high-quality, sustainable development.

According to the National Bureau of Statistics, China’s GDP grew by 5.2% year-on-year in the first three quarters, but the third quarter’s 4.8% growth lagged behind the 5.3% recorded in Q2. Key indicators like industrial output, fixed asset investment, and consumption showed signs of deceleration, with the property sector’s ongoing slump and rising trade frictions weighing heavily. However, services and emerging industries displayed resilience, with retail sales of consumer goods up 4.6% in the first eight months, driven by surges in eco-friendly food (27.9%), smart home products (14.3%), and “national trend” apparel (14.1%).

“This slowdown isn’t unexpected but reflects structural adjustments,” said Professor Li Daokui of Tsinghua University’s School of Economics and Management. “U.S.-China trade tensions and global supply chain shifts are testing China’s adaptability, but this is also a chance to optimize industries and boost innovation.” He noted that while exports grew 6.1% in Q3, the manufacturing PMI has lingered below 50 for two consecutive months, signaling challenges under the threat of potential U.S. tariffs.

Fourth Plenum: Blueprint for the Next Five Years

The Fourth Plenum, which opened yesterday, is a focal point of public attention. The session will finalize the “15th Five-Year Plan” (2026-2030), marking a transition from the current “14th Five-Year Plan” (2021-2025). Unlike past macroeconomic tweaks, this meeting emphasizes “high-quality development,” prioritizing technological self-reliance, domestic demand expansion, and green transformation.

Sources indicate the Plenum will address external uncertainties, such as potential trade barriers post-U.S. election and domestic challenges like declining birth rates due to an aging population. Recent policies include extended subsidies for families with three children and pilot programs for spring and autumn school breaks to ease parental burdens. Meanwhile, disposable income rose steadily by 5.3% in the first three quarters, and urban employment grew by over 11 million jobs, underscoring economic stability.

On anti-corruption, the Plenum will confirm disciplinary actions against several ousted Central Committee members. Since President Xi Jinping’s anti-graft campaign began in 2013, this year has seen a record number of investigations, including nine military generals and multiple local officials. State media emphasizes that these efforts aim to clear obstacles for economic reforms and enhance governance transparency.

Bright Spots: Technology and Consumption Surge

Despite challenges, China’s economy is accelerating toward innovation-driven growth. Huawei announced plans to double chip production capacity by 2026, signaling breakthroughs in domestic semiconductors. The AI market has exceeded expectations, with Microsoft reporting 195 million AI users in China, the largest globally. On the consumption front, “national trend” and eco-friendly products are booming, with homegrown brand Mixue Bingcheng expanding to 46,000 stores and posting 251% revenue growth.

Airbus has quietly launched a second assembly line in Tianjin, further integrating into the Belt and Road Initiative. However, U.S.-China chip tensions are intensifying, with China’s Ministry of Commerce adding 14 foreign entities to its “unreliable entity list” and launching antitrust probes into Qualcomm and Nvidia.

Outlook: Steady Progress Amid Resilience

Analysts predict Beijing will avoid aggressive stimulus in favor of targeted measures supporting the “dual carbon” goals (carbon peak and neutrality) and the digital economy. A Huatai Securities report forecasts 2025 GDP growth rebounding to 5.1%, buoyed by 9.6% annual growth in service consumption.

“China’s economy is like a giant ship—facing strong waves but on a clear course,” Professor Li Daokui concluded optimistically. “The 15th Five-Year Plan will mark a new chapter, propelling the great rejuvenation of the Chinese nation.” As the Plenum unfolds, global eyes are on China, awaiting a robust roadmap for the future.

(This article synthesizes reports from Xinhua, People’s Daily, The Wall Street Journal, and other sources. Please credit the source if republishing.)