Sinobravo Policy Express (December 2025)

Editor's note:

In November, supported by the continued effectiveness of proactive macroeconomic policies and the deepening of the construction of a unified national market, China’s economy maintained an overall stable and improving trend. The service sector grew steadily, with the production index up 4.2% year on year. Industrial production rose 4.8% year on year; total retail sales of consumer goods increased by 1.3%; fixed asset investment fell by 2.6% year on year. In the high-tech sector, investment in information services, and in the aviation, aerospace, and equipment manufacturing industries increased by 29.6% and 19.7% year on year, respectively. Total imports and exports of goods grew 4.1% year on year, with continued improvement in trade structure. The average surveyed urban unemployment rate stood at 5.2%, indicating overall stable employment. The consumer price index (CPI) rose year on year, and producer prices continued to rise month on month. Overall, the national economy is on an upward trajectory, with key indicators improving steadily. However, it still faces challenges such as a complex external environment and pressures in certain industries, indicating that the foundation for economic recovery needs further consolidation.

Recently, the World Bank, the International Monetary Fund (IMF), and the Asian Development Bank (ADB) have collectively revised upward their forecasts for China’s 2025 economic growth. The World Bank stated that proactive fiscal and moderately accommodative monetary policies are effectively supporting domestic consumption and investment, while export market diversification further strengthens China’s foreign trade resilience. These positive assessments highlight the global recognition of China’s economic resilience and the effectiveness of its macroeconomic policies, injecting stable momentum into global economic recovery.

Economic operation

On December 15, the National Bureau of Statistics released China’s November economic data, showing steady improvements across multiple indicators and continued stable, upward economic momentum

• Grain Harvest: Total grain output for the year reached 1.4298 trillion jin, an increase of 16.75 billion jin (1.2%) year on year, remaining above 1.4 trillion jin.

• Industrial Production: In November, industrial value-added for enterprises above a designated size increased 4.8% year on year and 0.44% month on month, with notable growth in equipment manufacturing and high-tech manufacturing sectors.

• Service Sector: The production index for the service industry rose 4.2% year on year.

• Retail Sales: Total retail sales of consumer goods grew 1.3% year on year.

• Fixed Asset Investment: From January to November, total fixed asset investment reached 44.4035 trillion yuan, down 2.6% year on year; investment in information services and in aviation, aerospace, and equipment manufacturing rose 29.6% and 19.7%, respectively; private investment fell 0.7%.

• Trade: Total import and export volume in November was 3.8987 trillion yuan, up 4.1% year on year. Exports were 2.3456 trillion yuan (up 5.7%), while imports were 1.5531 trillion yuan (up 1.7%), yielding a trade surplus of 792.5 billion yuan.

• Prices: The November CPI rose 0.7% year on year; producer prices fell 2.2%, and input prices fell 2.5%.

• Employment: The average urban surveyed unemployment rate from January to November was 5.2%, with November at 5.1%, unchanged from October.

Policy environment
High-level Interaction

• On December 4, President Xi Jinping held talks with French President Emmanuel Macron, emphasizing deeper cooperation in aviation, aerospace, and nuclear energy, and exploring collaborations in green economy, digital economy, biopharma, AI, and new energy.

• On December 9, Premier Li Qiang held a “1+10” dialogue with heads of major international economic organizations, reaffirming China’s commitment to building a mutually beneficial global trade system and contributing more to world economic recovery.

• Vice Premier He Lifeng met with U.S. and European corporate and government leaders to promote stable China-U.S. commercial relations and high-level opening-up.

• Minister of Commerce Wang Wentao held multiple meetings with leaders from Procter & Gamble, South Korea, Germany, and other countries to expand cooperation and maintain smooth supply chains.

• Minister of Industry and Information Technology Li Licheng met AMD CEO Lisa Su to discuss enhanced cooperation in the digital economy and AI.

• Other notable engagements included meetings between Chinese trade officials and executives from Apple, PayPal, AMD, and Hilton, focusing on fostering investment and business collaboration in China.

Outward Direct Investment (ODI)

• State Council: Approved the Commercial Mediation Ordinance (Draft) to align domestic commercial mediation standards with international norms.
• People’s Bank of China (PBoC): Issued multiple circulars to improve cross-border financing management, expand RMB cross-border payment systems (CIPS), promote digital RMB international applications, and enhance investment efficiency.
• Ministry of Commerce (MOFCOM): Released the 2025 Country Trade Guide and Action Plan for Promoting High-Quality Development of Service Outsourcing, encouraging Chinese enterprises to explore international markets.
• Other agencies: Including market regulators, tax authorities, and local governments (Shanghai, Zhejiang, Guangxi, Hainan) issued measures to enhance overseas financing, mitigate investment risks, and expand foreign cooperation in key industries and financing innovation zones (e.g., Shanghai FTZ, Zhejiang’s foreign investment incentives).

Foreign Direct Investment (FDI)

• NDRC: Issued the 2025 Catalogue for Encouraged Foreign Investment Industries, encouraging investment in advanced manufacturing, modern services, high-tech, and green sectors.
• CSRC: Proposed pilot REITs for commercial real estate, opening new channels for long-term foreign capital.
• MOFCOM: Reinforced trade compliance and improved coordination between trade and finance to facilitate inbound consumption and cross-border business integration.
• Other ministries (Transport, Culture & Tourism, Justice) issued measures easing cruise operations, improving inbound tourism, and facilitating cross-border legal services for Hong Kong, Macau, and Taiwan investors.
• Local initiatives—such as in Shanghai, Guangdong (Shenzhen), Fujian, and others—implemented policies to attract foreign investment in biotech, R&D, and financial innovation.

Taxation

•State Council: Approved the Implementing Regulations for the VAT Law (Draft) and the 2026 Tariff Adjustment Plan, clarifying future tax structures to ensure fair competition and smooth import-export taxation.
• MOFCOM: Announced anti-dumping reviews and rulings on materials and agricultural products from the U.S., Japan, South Korea, Malaysia, and the EU to protect domestic industries.
• State Administration of Taxation: Released guidelines for managing tax arrears, taxation in bankruptcy procedures, and clarified rules for pre-tax deductions on advertising expenses.
• Hainan: Issued new preferential tax policies for the Hainan Free Trade Port, including “zero tariffs” and lower corporate and income tax rates.
• Zhejiang and Yunnan: Announced local fiscal incentives supporting R&D investment and sustainable industrial practices through targeted tax reliefs.

Please click the following link to see more industry trends: 中富博睿政策速递（2025年12月刊）

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