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China's Q1-Q3 2025 Economic Update: Key Insights for Foreign Founders
China's economy grew 4.6% year-on-year in the first three quarters of 2025, with strong new growth drivers and rising domestic demand. Foreign founders can leverage these trends for company registration and operations in China.
China's Q1-Q3 2025 Economic Update: Key Insights for Foreign Founders
On October 20, 2025, China's National Development and Reform Commission (NDRC) held a press conference to discuss current economic hotspots. The data and policies presented offer valuable insights for foreign entrepreneurs planning to register or operate a company in China. Below, we summarize the key points and explain how they may affect your business decisions.
Economic Performance: Stable, Innovative, and Resilient
In the first three quarters of 2025, China's GDP grew by 4.6% year-on-year, despite global geopolitical tensions and frequent natural disasters. The NDRC characterized the economy as “stable, innovative, and resilient.”
- Stable: Macroeconomic performance remained within a reasonable range, with stable employment and prices, improving development efficiency, and better market expectations.
- Innovative: New growth drivers are accelerating. Key achievements include breakthroughs in integrated circuit core technologies, with mature process capacity ranking first globally; AI open-source large models surpassing 10 billion global downloads; humanoid robots accounting for over 90% of global shipments; innovative drug licensing deals worth USD 130 billion in the first three quarters, nearing last year's total; and new energy vehicle penetration reaching 53.6%.
- Resilient: Economic resilience has been reinforced through increased investment in “two major” constructions (major projects and major infrastructure), strengthened reserves of key materials, and secure supply chains for food and energy.
Policy Measures: Synergizing Existing and New Policies
The NDRC is implementing both existing and incremental policies to ensure a good start for the 15th Five-Year Plan. Key measures include:
- Enhancing existing policies: Advancing major projects under the 15th Five-Year Plan and “Six Networks” implementation plans, stimulating private investment by introducing private capital into nuclear, hydropower, and water conservancy projects, optimizing policies for key industries and computing infrastructure, and accelerating the renovation of old reservoirs and high-standard grain warehouses.
- Introducing new policies: Implementing recently launched measures such as lowering the pledged supplementary lending rate, increasing re-lending quotas, providing interest subsidies for residential mortgage loans, and financial support for the service sector. The NDRC will also monitor the economy and prepare new policies as needed.
Domestic Demand: A Key Driver for Growth
Domestic demand contributed 74.8% to economic growth in the first three quarters. Retail sales of goods and services grew by 2.6% year-on-year, while investment in intellectual property products increased by 9.3%. The NDRC is drafting an implementation plan for expanding domestic demand (2026-2030) and will focus on:
- Boosting consumption: Combining livelihood improvement with consumption promotion, increasing public service spending, expanding consumer goods upgrades (e.g., new energy vehicles, smart products), and removing unreasonable consumption restrictions.
- Expanding effective investment: Coordinating 109 major projects under the 15th Five-Year Plan with “Six Networks” construction, utilizing ultra-long special government bonds and new policy-based financial tools, and improving mechanisms for private enterprises to participate in major projects.
- Improving institutions: Issuing regulations for building a unified national market, unifying property rights protection and market access rules, and deepening reforms in local government investment and financing models and income distribution.
Recently, the NDRC publicly promoted 88 investment projects to private enterprises in two batches, with a planned introduction of RMB 31.1 billion in private capital. The NDRC will continue to break down hidden barriers, strengthen factor guarantees, and open application scenarios to encourage private investment.
Developing New Quality Productive Forces: Tailored Approaches
The Central Committee and State Council have issued opinions on developing new quality productive forces. The NDRC emphasizes “tailoring measures to local conditions” in three aspects:
- Scientific planning: Local governments must fully justify their foundation and conditions when planning key industries and major projects. The NDRC will coordinate national and provincial special plans for future industries and emerging pillar industries.
- Leveraging comparative advantages: Projects should be thoroughly demonstrated to avoid blind investment. For example, regarding overheating investment in some hydrogen energy segments, the NDRC is drafting plans to rationally layout major projects based on national strategic needs, technological maturity, and factor support conditions.
- Standardized and precise support policies: Local governments must use policies in accordance with unified national market rules and avoid red lines such as “involuted” competition and vicious investment attraction.
Additionally, the NDRC and relevant departments have launched the first batch of 136 landmark major application scenarios to accelerate the maturation and application of new technologies, products, and formats. For instance, smart mining scenarios will activate resources from over 2,800 mines, providing validation space for cloud computing, industrial IoT, intelligent sensing, and autonomous driving.
Implications for Foreign Founders
These developments present opportunities for foreign entrepreneurs. The emphasis on new quality productive forces, domestic demand expansion, and private investment suggests a welcoming environment for innovative businesses. Key sectors such as AI, new energy vehicles, smart manufacturing, and healthcare are highlighted. Foreign founders can benefit from policies encouraging private investment in major projects and the opening of application scenarios. When registering a company in China, consider aligning your business with these priority areas to leverage policy support. Additionally, the push for a unified national market and removal of consumption restrictions may simplify market entry and operations.
For specific guidance on company registration, sector-specific regulations, and available incentives, consult official sources or professional advisors.
Call to Action: Foreign founders can contact ChinaMNC on WhatsApp / WeChat at +86 153 1898 8535 for help registering and operating a company in China.
This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.