The cost burden for Chinese companies has increased and some companies are still under pressure.Image: keystone
China’s economy lost significant momentum in April. Key economic data fell short of analysts’ expectations, according to data from the Beijing statistics office.
May 18, 2026, 08:17May 18, 2026, 08:17
Retail sales only rose by 0.2 percent in April compared to the same month last year. In March the increase was 1.7 percent. Industrial production increased by 4.1 percent, after 5.7 percent in March. Investments were also disappointing: fixed investments fell by 1.6 percent in the first four months of the year compared to the same period last year. In the first quarter they had increased by 1.7 percent.
When presenting the figures, statistics office spokesman Fu Linghui pointed to the resilience of the Chinese economy despite the ongoing geopolitical conflict in the Middle East, greater fluctuations in the international energy market and strains on global supply chains. At the same time, he admitted that there are many external uncertainties. The cost burden for companies has increased and some companies are still under pressure.
Weak domestic demand burdens
China’s economy was still growing robustly at the beginning of the year. In the first quarter, gross domestic product increased by 5.0 percent and was therefore at the upper end of the official annual target of 4.5 to 5.0 percent. Exports were also surprisingly resilient despite the Iran war and higher energy prices.
Economists currently see weak domestic demand as the main problem. In addition, if the conflict in the Middle East lasts longer and puts additional strain on the global economy, this could also become problematic for China. The People’s Republic is heavily dependent on exports. If demand from other countries weakens, an important pillar of the Chinese economy would weaken. (sda/awp/dpa)