China in 2025: Economic Slowdown and Political Consolidation

China's economic miracle is not over — but it is entering a more challenging phase. The property sector crisis, demographic pressures, and geopolitical tensions with the West are creating headwinds that Beijing's policymakers are struggling to address.

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The Property Crisis

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China's property sector — which accounts for roughly a quarter of GDP — is undergoing a painful contraction. Major developers have failed; millions of homes sold but unbuilt remain a political liability.

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The Demographic Challenge

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China's population is now declining. The working-age population peaked several years ago. The era of cheap, abundant Chinese labour is ending.

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Xi's Response

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President Xi has responded to economic difficulty with political consolidation, state-directed industrial policy and increased pressure on private enterprise.

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Implications for Britain

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UK-China relations require careful management. Economic engagement offers real benefits; strategic risks must be honestly assessed and actively managed.

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