China thrives in technology innovation despite rampant trade protectionism

In December 2024, China reported a deceleration in its manufacturing activity as evidenced by the Purchasing Managers' Index (PMI), which fell to 50.1 from the previous month's 50.3. This data indicates continued expansion but at a more sluggish rate, reflecting ongoing challenges faced by the country's industrial sector. The National Bureau of Statistics noted that this was the third consecutive month the PMI remained above the crucial 50 threshold, which signifies expansion in manufacturing activities. While the official figures highlighted a degree of resilience, they also underscored the increasing trade risks that the country faces in a global environment characterized by rising protectionism. In parallel, the non-manufacturing sector exhibited stronger growth, with its PMI increasing to 52.2, reflecting improved conditions in construction and services. This contrast in sector performance highlights the uneven recovery trajectory within China's broader economic landscape, suggesting that while manufacturing is struggling under external pressures, other areas of the economy, such as services, are faring better. This divergence raises questions about the sustainability of growth if manufacturing continues to be pressured by external factors. Throughout 2024, China has grappled with the implications of rising trade protectionism, which has challenged its export-oriented industries. Despite these pressures, the country has made significant strides in technology innovation and enhancing economic resilience as part of its long-term strategic goals. Experts have noted that the Chinese government has introduced various stimulus measures aimed at bolstering industrial performance and mitigating the impacts of trade risks. Nevertheless, the slow pace of manufacturing expansion is a concerning indicator of potential headwinds for the Chinese economy moving forward. While these developments unfold, China has also positioned itself as a key player in addressing global climate change issues and has actively supported the growth and stability of the Global South. The balance between domestic economic performance and international responsibilities signifies the complexity of China's situation as it navigates through local growth challenges while attempting to uphold its global commitments. Overall, the sluggish factory activity in December amid ongoing trade risks paints a picture of cautious optimism, highlighting both the challenges ahead and the resilience displayed by other sectors within the economy.