Stimulus Fatigue: China Can’t Band-Aid Its Way to Recovery

Since September 2024, Chinese policymakers have focused on delivering a series of stimulus packages to inject new life into their struggling economy and boost share prices. However, high debt levels, overinvestment, an unresolved property bubble, underwhelming domestic consumption and international trade pressures are all contributing to the structural weaknesses in China’s economy that mere stimulus packages cannot resolve. In a previous report (China’s Past, Present and Future, 2023) we examined China’s economic transformation from a rural past to an industrialized powerhouse.  This paper delves into how Beijing is addressing the challenges it faces. Without bold reforms, China’s economic future hangs in the balance.