China's service sector slowed down in December.
This marks the fourth consecutive month of slowdown, signifying the weakest growth rate in the past six months. The main reason is a decline in new export orders, a consequence of the drop in tourist numbers, particularly from Japan, due to diplomatic tensions. Weak domestic consumer spending continues to leave the Chinese economy vulnerable to external risks, especially as its trade surplus exceeding $1 trillion attracts increasing scrutiny from global trading partners.
Nevertheless, the services sector has been a rare bright spot in China's sluggish consumer market for much of the past year. The government is working to boost household spending through measures encouraging consumption of services such as sports , travel, and entertainment.
The overall picture still reveals numerous structural challenges, from the prolonged real estate crisis to industrial overcapacity. These issues could persist into 2026.
Chinese authorities have not launched any further large-scale stimulus packages this year to achieve their economic growth target of around 5%. However, boosting domestic production without additional consumer support measures could exacerbate deflationary pressures. According to released data, profits of Chinese industrial companies fell 13.1% in November compared to the same period last year. This is the sharpest decline in over a year, indicating that household consumption has not yet offset the weakness caused by the global economic slowdown.
Chinese consumers have remained cautious about spending so far. This is due to uncertain job prospects and a prolonged real estate crisis that has reduced household assets.
Source: https://vtv.vn/nganh-dich-vu-trung-quoc-chung-lai-100260105221640954.htm
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