Chinese President Xi Jinping is visiting several Asian nations this week, promoting free trade and positioning China as a source of stability and certainty amidst global volatility.

Concurrent with Xi's visit to Vietnam, Malaysia, and Cambodia, the U.S. declared that a high-ranking State Department official, Sean O'Neill, was slated to travel this week to Hanoi and Ho Chi Minh City in Vietnam, Siem Reap in Cambodia, and Tokyo.

China has also been emphasizing its trade relations with countries other than the United States at various trade exhibitions, underscoring the magnitude of its market and its formidable competitiveness as a manufacturing powerhouse.

Stimulated by exports, the Chinese economy is projected to grow by roughly 5% in 2024, aligning with this year's official growth target of around 5%.

While the tariffs are expected to exert short-term pressure on the Chinese economy, they are unlikely to impede long-term growth, according to Sheng Laiyun, a spokesperson for the National Bureau of Statistics.

"China's economic underpinnings remain solid, adaptable and hold considerable promise. We are confident in our capacity and competence to navigate external pressures and attain our predetermined developmental objectives," Sheng stated.

On a quarterly basis, the economy expanded by 1.2% during the January-March period, a deceleration from the 1.6% growth recorded in the final quarter of 2024.

In March, Chinese exports saw a significant increase, exceeding 12% compared to the previous year, and a rise of nearly 6% in U.S. dollar value during the first quarter, as businesses accelerated shipments in anticipation of Trump's impending tariffs, thereby bolstering strong manufacturing performance over recent months.

Much of this activity was initially concentrated, driven by a surge of proactive efforts preceding U.S. tariff increases and a rapid accumulation of inventory in the United States as importers hastened to anticipate developments, according to Stephen Innes of SPI Asset Management in a commentary.

Industrial production saw a robust 6.5% increase year-on-year in the final quarter, primarily propelled by a substantial nearly 11% surge in the output of equipment manufacturing.

Remarkable growth was observed in cutting-edge technologies, particularly in the production of battery electric and hybrid vehicles, which saw a substantial increase of 45.4% compared to the previous year; concurrently, the output of 3D printers surged by nearly 45%, and that of industrial robots rose significantly by 26%.

Even though it grew quite fast compared to other countries, the Chinese economy has found it hard to get back to normal since the COVID-19 pandemic. This is because problems in the property market have increased unemployment, making families hesitant to spend money.

Consumer prices experienced a marginal decline of 0.1% in the initial quarter, indicating a disparity between demand and supply across various sectors. Furthermore, investment in real estate persisted in its weak state, registering a drop of almost 10% compared to the preceding year, even in the face of governmental initiatives aimed at stimulating lending for housing acquisitions.

The coming tariffs crisis is a big problem at the same time that Beijing is trying hard to get companies to invest and hire more people, and to get Chinese shoppers to buy more things.

Economists in both the private and public sectors have maintained a degree of caution regarding future expectations, largely due to Trump's consistent shifts in his position on the specifics of his trade dispute.

Because of what has happened in the last two weeks, it is very hard to say how the taxes the U.S. and China put on each other's goods might change, according to a report from Tao Wang and other economists at UBS.

The International Monetary Fund and Asian Development Bank have maintained more optimistic predictions of roughly 4.6% growth for the current year.

Upon assuming office, Trump initially imposed a 10% tariff increase on imports from China, subsequently escalating it to 20%. Currently, a significant proportion of China's exports to the United States are subject to a tariff rate of 145%.

UBS projects that, assuming the tariffs persist at their approximate current levels, China's exports to the United States may decline by two-thirds in the near future, and its total global exports could decrease by 10% in monetary value. Consequently, UBS has lowered its forecast for economic growth this year from 4% to 3.4% and anticipates a further deceleration to 3% by 2026.

Over the past seven months, China has intensified measures aimed at stimulating greater consumer expenditure and private sector investment, significantly increasing subsidies for trading in vehicles and appliances while directing more capital towards housing and other financially challenged sectors.