China’s economic slowdown deepens amid renewed US trade war threats – NaturalNews.com

• China’s GDP growth slowed to 3.9 percent in the third quarter of 2025, down from 4.9 percent in the same period last year.
• Lockdown policies suppress consumer spending, exacerbating the economic recession.
• Trade tensions escalated with the United States threatening to impose 100% tariffs on Chinese imports.
• The real estate market crisis and weak domestic demand are adding to the pressure on recovery efforts.
• Communist Party leaders meet to formulate a five-year economic plan amid mounting challenges.

The Chinese economy, once the engine of global growth, is now faltering. Official data reveal GDP expanding by 3.9% in the third quarter of 2025 – well below 4.9% last year – as strict lockdowns stifle consumer activity and renewed US trade hostilities threaten the stability of exports. The slowdown highlights deeper structural weaknesses, including the collapse of the real estate sector and dwindling domestic demand, raising concerns about Beijing’s ability to maintain its five percent annual growth target.

The contraction coincides with escalating tensions between Washington and Beijing. After China imposed export controls on rare earth minerals, which are crucial to electronics and green energy, US President Donald Trump responded by threatening to impose 100% tariffs on Chinese goods – a move that could derail months of fragile trade detente. Treasury Secretary Scott Besent is scheduled to meet Chinese officials in Malaysia this week in an attempt to calm tensions, but the prospects for a summit between Trump and Xi remain uncertain.

Lockdowns stifle spending

China’s COVID-free policies, although relaxed in some areas, continue to disrupt daily life and stifle economic activity. Retail sales growth slowed sharply to just 3% in September – well below pre-pandemic levels – while fixed asset investment fell 0.5%, indicating weak consumer confidence and stalling business expansion. Industries such as hospitality, travel and luxury goods were hardest hit, with restaurants and retailers reporting sharp declines in foot traffic. Despite the government’s stimulus measures – including wage increases, tax breaks and subsidies – households remain hesitant, hoarding savings rather than spending, exacerbating deflationary pressures. Analysts warn that prolonged restrictions could exacerbate China’s economic slowdown, with ripple effects across global supply chains.

Flashpoints in the trade war loom

China’s export sector, which has long been one of the pillars of its economy, faces increasing risks. While global shipments rose 8.4% in September, supported by pre-tariff inventories, sales to the United States fell 27%. The dispute over rare earths has raised fears of an all-out trade war, reminiscent of the clashes in 2018-2020 that rocked global markets. Analysts warn that further US sanctions could cripple China’s technology and manufacturing sectors, which rely heavily on US markets.

The real estate crisis continues

The real estate crash, which has been underway since 2021, remains a serious drag. Real estate investments fell by 13.9% year-on-year, with house prices falling in almost every major city. Developers, burdened with debt, are abandoning their projects, leaving buyers stranded and local governments starved of revenue. Standard & Poor’s Global expects new home sales to decline by 8% in 2025, with no recovery in sight.

Party planners face tough choices

As Communist Party leaders meet to formulate China’s economic plan for 2026-2030, they face stark trade-offs. Intensifying stimulus threatens to balloon debts, while austerity could deepen the recession. Meanwhile, the US election looms, where Trump’s return could mean more tariffs, while a Democratic administration could ease tensions.

A perilous road ahead

China’s slowdown is not just a cyclical downturn; it reflects systemic weaknesses. Lockdowns drain vitality, trade wars threaten exports, and real estate collapses erode confidence. Without bold reforms, Beijing’s dream of overtaking the United States as the world’s largest economy may remain just a dream. For now, all eyes are on Malaysia, where American and Chinese officials intend to test whether diplomacy can avert another economic cold war.

The high stakes of China’s economic crossroads

With China’s growth faltering, the risks could not be higher. Any mismanagement of trade tensions or domestic reforms could lead to a deeper recession – one that is reverberating throughout global markets. For Washington, the challenge lies in balancing pressure with realism. For Beijing, the question is whether it can adapt before recession becomes the new normal. The world is watching.

Sources for this article include:

YourNews.com

BBC.com

NBCnews.com