China Market Intelligence

At the annual two sessions meetings earlier this month, China unveiled its 2025 government budget, detailing its spending priorities for the year. Aligned with the themes of the Government Work Report, which includes the highest projected deficit-to-GDP ratio in three decades, the budget enables greater spending to allow for a more proactive fiscal policy.

The Trump administration’s approach to trade with China is a tangled web of existing and potential future trade actions. While there has not been a coordinated effort to clarify exactly how the administration will roll out new actions, the threat still looms.

Senior Chinese policymakers are once again signaling their embrace of the foreign business community with a new action plan for boosting foreign investment in China. The plan marks a focused government effort to incentivize more foreign participation in the China market and identifies a range of investment opportunities in mostly services sectors.

The Chinese People’s Political Consultative Conference will begin on March 4, followed by the National People’s Congress (NPC) on March 5. Together, these meetings—known as the “two sessions”—serve as China’s most important annual political event, shaping the direction of national economic and social policy.

The Shanghai Free Trade Zone (FTZ) and associated Lingang New Area recently introduced the first batch of general data negative lists for cross-border data transfers (CBDTs). The lists cover both “personal information” and “important data” in reinsurance, international shipping, retail, catering, and hospitality.

Late last year, China’s State Administration for Market Regulation (SAMR) released a draft implementation plan for the Regulations on Fair Competition Review (RFCR)—a regulatory overhaul reflecting a decade-long push to ensure that government policies are non-discriminatory and comply with fair competition principles.

Last month, preferential procurement of low-priced medical products under China’s volume-based procurement (VBP) system reignited public debate over the right balance between quality and affordability in the healthcare system. This procurement was prominent during the country’s 10th round of VBP for drugs and 5th round for high-value medical consumables in December.

On February 1, President Donald Trump followed through on his plan to impose an additional 10 percent tariff on all imports from China, effective Tuesday. He also imposed a 25 percent tariff on most imports from Canada and plans to impose tariffs on imports from Mexico at the same rate next month.

China’s economy experienced a moderate rebound in the final quarter of 2024, providing the needed push for the country to meet its annual growth target of around 5 percent. According to data released by the National Bureau of Statistics, China’s real GDP in 2024 reached RMB 134.9 trillion ($18.42 trillion), marking 5 percent year-on-year growth.