Chinese GDP growth stronger than expected, fueled by state infrastructure spending

Chinese spending on infrastructure investments fueled stronger-than-expected GDP growth, despite weak consumer spending and a shrinking trade surplus, according to the official government statistics agency. 

China’s National Bureau of Statistics announced Thursday that the country's Gross Domestic Product, GDP, grew 1.3% compared to the final three months of 2025. If that rate continues, China is on track for a GDP growth of about 5.3% this year and comes in slightly higher than estimates. 

The communist-run country's real estate crisis, ongoing for several years, shows no signs of fading. The crisis, which caused a steep decline in apartment prices, gutted household savings. Consumers responded by cutting spending. 

But, the data show that China saw an 8.9% increase in infrastructure investments in the first quarter compared to last year, a sharp increase. The Chinese government often directs spending to electricity grid improvements and transportation and other infrastructure projects in order to stimulate a flagging economy. 

U.S. tariffs and instability from the Iran conflict have also undermined China's export-driven trade surplus, which has been a large contributor to Chinese GDP growth in the past. 

China's GDP is second only to the United States'