China: Donald Trump’s tariffs are not just China’s problem.

Beijing announced on Friday that China’s economy improved in the last three months of last year, allowing the government to meet its 2024 growth target of 5 percent.

But it is one of the slowest growth rates in decades as the world’s second-largest economy struggles to overcome a protracted property crisis, high local government debt and youth unemployment.

The head of the country’s statistics bureau said China’s economic gains in 2024 were “hard-won”, after the government launched a series of stimulus measures late last year.

Beijing has rarely met its growth targets in the past.

Experts had widely predicted this growth rate. Low borrowing costs and rising exports mean China could achieve annual growth of 4.9 percent, the World Bank said.

However, investors are bracing themselves: President-elect Donald Trump’s threat of tariffs on $500bn (£409bn) worth of Chinese goods looms large.

Yet that is not all that stands in the way of China achieving its growth targets next year.

Business and consumer confidence are low, and the Chinese yuan will continue to weaken as Beijing cuts interest rates to boost growth.

Here are three reasons why Shay has bigger challenges. Trump’s tariffs:

There is a growing chorus of warnings that China’s economy will slow in 2025. A major driver of last year’s growth is now at risk: exports.

China has relied on manufacturing to help it pull out of the slowdown — so, it’s exporting record numbers of electric vehicles, 3D printers and industrial robots.

The United States, Canada and the European Union have accused China of manufacturing too many goods and imposed tariffs on Chinese imports to protect domestic jobs and businesses.

Experts say Chinese exporters can now focus on other parts of the world. But these countries are likely to be in emerging markets, which do not have the same level of demand as North America and Europe.

This could affect Chinese businesses hoping to expand, potentially hurting suppliers of energy and raw materials.

Xi wants to transform China from the world’s factory of cheap goods to a high-tech powerhouse by 2035, but it’s unclear how manufacturing can drive such huge growth despite rising tariffs.

Household wealth in China is mostly invested in the property market. Before the real estate crisis, it accounted for about a third of China’s economy – employing millions of people, from builders and developers to cement producers and interior designers.

Beijing has implemented a number of policies to stabilize the property market and the China Securities Regulatory Commission (CSRC), the financial markets watchdog, has said it will strongly support reforms.

But there are still plenty of vacant homes and commercial properties, and that oversupply is forcing prices down.

The slump in the property market is expected to ease this year, but Wall Street banking giant Goldman Sachs says the slowdown will be a “multi-year drag” on China’s economic growth.

It’s already hitting spending hard — in the last three months of 2024, household consumption contributed just 29 percent of China’s economic activity, down from 59 percent before the pandemic.

This is one reason why Beijing has increased exports. It wants to help offset sluggish household spending on new cars, luxury items and just about everything else.

Such programs have also been introduced by the government. Trade in consumer goodsWhere people can exchange their washing machines, microwaves and rice cookers.

But experts wonder if these kinds of measures alone are enough without addressing the economy’s deeper problems.

They say people will need more money in their pockets than pre-Covid levels to pay back expenses.

“China needs to bring back the animal spirit of the population and we are still a long way from that,” said Shuang Ding, chief economist for Greater China and North Asia at Standard Chartered Bank.

“If the private sector starts investing and innovating, it can increase income and job prospects, and people will have more confidence to use.”

Huge public debt and unemployment have also affected savings and spending.

Official figures show. Youth unemployment rate higher than before the pandemic, and wage growth has stalled.

President Xi has pledged to invest in cutting-edge industries that the government calls “new productive forces.”

So far, it has helped China become a leader in renewable energy products such as solar panels and electric vehicle batteries.

Last year, China overtook Japan to become the world’s largest car exporter.

But a weak economic picture, uncertainty over tariffs and other geopolitical uncertainties mean foreign businesses are less willing to invest in China.

It’s not about foreign or domestic investment — it’s that businesses don’t see a bright future, said Stephanie Leung from wealth management platform StashAway.

“They would like to see a more diverse set of investors come in.”

For all these reasons, experts believe that measures to support the economy will only partially mitigate the potential impact. New US tariffs.

Beijing must either take big, bold steps or accept that the economy will not grow as fast, Goldman Sachs chief China economist Hui Shan wrote in a recent report: “We expect that the former Will choose.”

“China needs to create enough jobs to stabilize property markets and ensure social stability,” said Mr Ding from Standard Chartered Bank.

According to researcher China Descent Monitor, More than 900 demonstrations took place in China. Led by workers and property owners between June and September 2024 – up 27% from the same period a year ago.

These kinds of social tensions resulting from economic grievances and wealth erosion would be a concern for the Chinese Communist Party.

After all, explosive growth has turned China into a global power, and the promise of growing prosperity has largely helped its leaders keep a tight lid on dissent.