Publications

China’s Outward Direct Investment (ODI) flows are undergoing a structural reconfiguration driven by geopolitical risk and protectionism. Investment is shifting sharply away from Global North countries and toward the Global South due to increased scrutiny. Future expansion will emphasize deep localization in key regions.

Domestic headwinds including housing market crash, overcapacity, weak sentiments take the place of tariff war to be the dominant factors for China’s growth slowdown.

China's 4% official GDP deficit for 2025 doesn't fully capture its fiscal stance due to a complex budget structure. The Government Funds Budget, reliant on land sales, significantly influences the economy via its total spending. A spending shortfall here signals demand weakness and deflationary risks.

As the trade war shock has faded, the recent data surprised the market to the downside as domestic risks take the place of external shock to become the main drag on growth in China.

We raise the China GDP forecast based on the recent China-US Geneva Agreement and the 3nd round stimulus. We also analyze the recent economic development and the policy outlook.

The report analyzes U.S. reciprocal tariffs on Asian countries, with Cambodia and Vietnam hit hardest. Dual dependency puts many Asian economies in a strategic dilemma between the US and China. Using input-output models, it presents three scenarios (risk, pragmatic, optimistic) showing varying GDP impacts.

Amid the China-US trade war, we still raised our China 2025 and 2026 GDP forecast due to the jumbo size stimulus package, the new growth engine high-end manufacturing to support growth and lower-than-expected tariff imposed.