Arabfields, Farah Benali, Economic Correspondent, China — China’s economy has regained momentum, but sustaining that growth will depend on whether stronger exports can be matched by a recovery in domestic consumption.

The economy expanded by 4.5% year on year in the third quarter, accelerating from 4.3% in the previous quarter, according to recent economic data. The improvement has put China closer to its official full-year growth target of 4.5% to 5%.

Exports have provided much of the recent support, with overseas demand helping manufacturers maintain production and offset weakness at home. However, the recovery remains uneven, as the property downturn and cautious household spending continue to weigh on the broader economy.

For ordinary consumers, the difference between strong national growth figures and everyday economic conditions remains significant. Households facing uncertainty over employment, wages and housing have been reluctant to increase spending, limiting the contribution of domestic demand to the recovery.

The challenge is particularly important for businesses that rely on the domestic market. Retailers and service providers need consumers to feel more confident about their financial prospects before a sustained improvement in spending can take hold.

China’s trade surplus reached about $938 billion through September, putting the country on course for another exceptionally strong annual trade performance. Yet the strength of exports has also increased trade tensions with major partners, including the European Union, where concerns about import competition are influencing economic and industrial policy.

Looking ahead, China could finish the year within its growth target if export demand remains resilient and existing policy support continues to underpin economic activity. However, a sharper slowdown in overseas markets or further weakness in the housing sector could complicate that outlook.

The next phase of the recovery will therefore depend not only on factory output and foreign sales, but also on whether households regain the confidence to spend. Without a stronger contribution from domestic consumption, economic growth may remain heavily dependent on external demand, leaving the outlook vulnerable to global trade disruptions.