Only one thing can truly rattle China

China's economic power, despite its relentless growth, faces an internal challenge: its dependence on the domestic market and on its citizens' consumption.

## the fragility of the colossus

Much is said about **China's** drive, about its ability to pull strings in the global economy. And it is true: its Gross Domestic Product (GDP) grew **5.2%** in **2023**, consolidating its position as the world's second-largest economy. But behind that facade of impregnable power lies a vulnerability that does not go unnoticed. The engine of this giant is not only exports or investment, but, and this is key, the appetite of its own citizens.

## consumption as the Achilles' heel

If anything can really slow **China** down, beyond geopolitical tensions or trade wars, it is the health of its domestic market. The spending capacity of the Chinese population is the thermometer that measures its true strength. When the Chinese consume, the wheel turns for everyone. If that consumption falters, the impact is felt worldwide. Last year, private consumption growth, although present, did not always meet the most optimistic expectations.

## the demographic challenge and confidence

Demographics play a crucial role. With an ageing population and a declining birth rate, the boost to future consumption could be affected. Add to this consumer confidence. Factors such as economic uncertainty, youth unemployment (which reached a worrying **21.3%** in June **2023** before age breakdowns stopped being published) or fluctuations in the property market can erode spending. If people do not feel secure, they hold on to their money.