Tue Apr 22 14:08:50 UTC 2025: ## IMF Cuts China’s Growth Forecast Amidst US Trade War

**Washington, D.C. – April 22, 2025** – The International Monetary Fund (IMF) significantly lowered its growth forecast for China’s economy, predicting a mere four percent expansion in 2025. This projection falls considerably short of Beijing’s official target of around five percent and reflects the escalating trade war with the United States, alongside persistent domestic challenges.

The IMF’s revised forecast, released Tuesday in its World Economic Outlook report, represents a downward revision from the 4.6 percent growth predicted in January. The reduced projection highlights concerns about China’s ability to withstand the pressures of a protracted real estate crisis, mounting local government debt, sluggish consumer spending, and the substantial impact of US tariffs. These tariffs, reaching as high as 145 percent on some products, have been met with retaliatory tariffs from China, creating a tit-for-tat trade war that has fueled global recession fears.

The IMF report emphasizes the lingering weakness in China’s real estate sector and its knock-on effects on local government finances as key factors contributing to the lowered forecast. Furthermore, consumer confidence remains depressed since its plunge in early 2022. The IMF cited China as one of the countries most severely affected by the recent surge in US trade protectionism under President Trump. The IMF also lowered its growth projection for China in 2026 to four percent, down from a previous forecast of 4.5 percent. The increasingly uncertain global economic landscape, characterized by “downside risks,” further contributed to the pessimistic outlook.

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