However, the upcoming transition in U.S. leadership, with President Donald Trump poised to impose additional tariffs on Chinese goods, raises concerns about the potential impact on these trade figures.

Recent policy easing measures, such as mortgage rate cuts and urban renovation initiatives, have yielded positive effects in major cities, yet challenges persist due to high inventory levels and weak household sentiment.

Concerns are growing that retaliatory measures from the U.S. and European countries against China's manufacturing subsidies could threaten China's growth in 2025.

China's exports saw a remarkable increase of 10.7% year-on-year in December 2024, outpacing economists' expectations of 7.3%, while imports rose by 1.0%, marking the strongest growth since July 2024.

Despite the positive export performance, China's economy, valued at $18 trillion, continues to grapple with a prolonged property crisis and low consumer confidence, with a growth target of around 5% set for 2025.

Core consumer inflation remains near 0%, contributing to deflationary pressures and raising economic concerns.

Since September 2024, Chinese authorities have implemented various economic stimulus measures, including interest rate cuts and a substantial municipal debt package worth approximately $1.36 trillion.

While top leaders acknowledge the need for economic growth, they are cautious about aggressive stimulus measures due to fears of deflation and the potential repercussions of U.S. tariffs.

Consumer prices in China have increased by only 0.2%, significantly below the government's inflation target of 3%, while producer prices have been declining for over two years.

China's import potential is substantial, but trade restrictions, particularly concerning advanced technology and military-related products, significantly hinder its access to certain products.

Emerging signs of a deflationary spiral in China pose a greater long-term risk than high inflation, as falling prices lead to decreased profits and wages.

German companies are reporting declining demand in China and are increasingly localizing their operations to remain competitive amid changing regulations.