Will The Chinese New Year Bring Long-awaited Economic Prospects?

In 2025, the Wood Snake represents a powerful symbol for the business world. For the Chinese, wood is an emblem of growth and inventiveness, while the snake represents wisdom and intuition. What economic prospects will the festivities to open the Year of the Snake have for domestic trade?

According to the online media Xinhuanet, ‘As China continues to relax its visa waiver policy, the country is seeing a significant increase in the number of foreign visitors’ keen to experience the Spring Festival (Chinese New Year) and its rich cultural traditions. Preliminary statistics show that ticket bookings for inbound flights during this period are up 47% on the previous year. A 25% increase in leisure travel is also forecast. ‘The most popular destinations are tropical hotspots such as Hainan and Yunnan, as well as winter destinations in Heilongjiang, Jilin and Xinjiang,’ said Shang Kejia, an official with the Civil Aviation Administration of China.

What influence will this particular year have on the domestic and international markets? 2025 begins with a major dilemma: will Donald Trump, the new President of the United States, succeed in imposing the high rates of tariffs that he promised during his campaign?

In 2024, the slowdown in Asia's leading economy caused great concern among investors around the world and generated a wave of panic, especially in certain sectors such as the automotive and luxury industries.

However, Chinese stock markets rallied at the end of the year, thanks to measures taken by the government to boost growth and put an end to the property crisis by lifting a series of restrictions.

The impact of this new legislation remains to be seen, however, and will probably only bear fruit after several months, or even quarters, as predicted by Bank of America analysts.

Donald Trump had announced on several occasions that he wanted to apply very high customs duties on Chinese products, of up to 60%, but in an interview with Fox News, broadcast last Thursday, the President backtracked, declaring that he would prefer not to impose these taxes on China.

This last-minute U-turn came as a relief to Xi Jinping's government, but raises fears of further brutal decisions by the tycoon, possibly influenced by the geopolitical stakes over Taiwan. It should be noted that Chinese exports to the United States account for around 4% of China's GDP.

As far as the domestic market is concerned, the Chinese economy can now count on a modern, efficient transport network, complemented by the new railway lines linking Shanghai to Huzhou and Jining to Jianping. 30,000 charging points for electric vehicles are dotted around the country, making China one of the best-equipped countries to face the electric revolution.

Xi Jinping wants to change the vision of the political economy by prioritising ‘quality’ growth over the rapid growth favoured until now. To achieve this, he is advocating more egalitarian and ecological development, but his vision includes a greater role for the State in guiding capital.

This desire for greater centralisation is likely to increase certain difficulties, as demonstrated by the disciplinary investigations of many senior executives in recent years. These measures therefore run the risk of reinforcing caution and market paralysis.