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China's economic recovery
EconomyChina Economy

Shanghai beats GDP estimates with 5.6% growth – but two-speed recovery persists

Official data points to a resilient tech-led rebound even as prominent economists warn household spending remains stubbornly cautious

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A view of the Lujiazui financial district in Pudong, Shanghai, on October 27, 2025. Photo: AFP
Mandy Zuoin Shanghai

Shanghai’s economy expanded 5.6 per cent in the first half of the year, beating expectations on strong growth in hi-tech manufacturing and exports, even as weak consumer spending exposed the uneven nature of the recovery.

According to data released by the municipal statistics bureau on Monday, the reading surpassed both the national growth rate of 4.7 per cent for the same period and the city’s own growth rates in recent years, signalling a resilient rebound in the financial and commercial centre.

But economists warned the figure also reflected a “K-shaped” divergence – a term used to describe an economic recovery in which some sectors experience sharp growth and others decline. This split has come to define China’s post-pandemic recovery, with booming hi-tech and export sectors contrasting with struggling domestic consumption and a deflating property market.

“Shanghai is a mirror of China’s broader transition,” said Shao Yu, director of the Shanghai Institution for Finance and Development, a prominent financial think tank.

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