UBS has sharply lowered its projection for China’s economic growth in 2025, now expecting it to reach just 3.4%. This revised estimate reflects the assumption that elevated U.S. tariffs will stay in place, while Beijing ramps up fiscal and policy support to cushion the slowdown. Earlier this month, the Swiss investment bank had a more optimistic view, predicting a 4% expansion. However, with escalating trade headwinds, China’s own target of around 5% appears increasingly difficult to meet.
UBS also warned of a dramatic drop in China’s overseas trade performance. It expects exports to the U.S. to slump by nearly two-thirds in the coming quarters, with total outbound shipments falling around 10% in dollar terms for the year. If trade tensions persist, the economic toll could deepen in 2026, pulling GDP growth even lower—to just 3%.
