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This year marks a strategic shift for China’s economy toward higher value and quality. According to Denis Depoux, the global managing director of an international consultancy, the nation is undergoing a deliberate transformation that significantly impacts the approach of businesses and investors. The focus is on a profound restructuring of the Chinese economy, emphasizing a balance between moderate growth targets and broader reform objectives.
Since 2023, China has been aiming for an annual growth rate of around 5%, down from 5.5% in 2022 and approximately 6% in 2021, with announcements typically made in early March. Experts estimate this year’s target to be between 4.5% and 5%, but Depoux emphasizes that the specific percentage is less important than understanding the underlying transformation taking place. A more modest growth goal provides political and fiscal space to implement meaningful reforms and address genuine economic challenges without the pressure to chase rapid growth at all costs.
This analysis is based on Roland Berger’s seventh annual industry forecast report, which examines trends across key sectors such as automotive, consumer goods, materials, and investment. The company has maintained a presence in China for over 40 years. Depoux highlighted investment data from the first three quarters of the previous year, noting a 2.6% decline in fixed asset investment driven mainly by a 15% drop in property and construction. Conversely, auto manufacturing investment increased by 15%, and transport equipment production soared by 22%, reflecting creative destruction—some sectors shrinking while others expand significantly—evidence of deep economic transformation.
Despite consumption accounting for over half of China’s economic growth in the first three quarters of 2025, household savings hit a record high of more than CNY 160 trillion (USD 22 trillion). Pointing out that just 5% of this amount equals the gross domestic product of a medium-sized country, Depoux suggests that even a small percentage of these savings being spent could have a substantial economic impact. However, he notes such shifts take time.
Several hurdles remain for China to translate savings into consumption growth, including consumer confidence related to income and employment stability, social safety nets providing security, and evolving consumer preferences. Today’s Chinese consumers seek more than just value; they demand quality service, memorable experiences, and emotional connections. This shift is described as a “revolution” for multinational consumer goods companies. The industry is entering a resilient phase where new retail formats, such as instant retail platforms, are gaining popularity.
In the automotive sector, vehicle sales reached about 34 million units last year, with 7 million exports, and new energy vehicles now account for over 60% of sales. The industry is transitioning from rapid volume growth to enhancing quality, profitability, and brand strength. Six primary areas will define China’s auto industry by 2026: elimination races, cross-industry collaboration, international expansion, technological rivalry, capital efficiency, and artificial intelligence integration.
The chemicals and materials industries face global pressures, but China maintains a competitive edge with continued expansion despite worldwide challenges. While global ethylene plants are shutting down, China is investing heavily in capacity. Over the past year, dealmaking reached more than USD 350 billion, with domestic mergers and acquisitions alone hitting nearly USD 20 billion in the first half, a significant increase from previous years. Experts believe this momentum will continue to accelerate over the next few years.
Chinese companies are shifting focus from scale-driven international expansion to high-quality globalization. Success in many sectors now depends on full integration into global value chains rather than just exporting.
If traditional growth engines like property development slow down, emerging drivers such as advanced manufacturing, green technology, digitalization, artificial intelligence, and high-value services are gaining momentum. China is increasingly recognized as a hub for innovation and competitiveness, offering opportunities for multinational firms to enhance their global standing. Domestic companies are encouraged to improve productivity, deliver higher quality, and prioritize profitability, efficiency, and operational excellence.
While China has historically been known for operational speed and execution, there is now a need for some firms to develop strategic superiority—focused, precise, and resolute—to navigate the complexities of the global marketplace effectively.
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