China: solid growth at the start of the year, but already weakened by the global energy shock

The Chinese economy posted robust growth in the first quarter of 2026, but the outlook is darkening due to the war in Iran, which threatens to disrupt global economic balances for a long time. Beijing must now contend with an increasingly uncertain external environment.

According to published data, China's gross domestic product (GDP) grew by 5,0% year-on-year between January and March, compared to 4,5% in the previous quarter. This level falls within the upper range of the annual target set by the authorities, between 4,5% and 5,0%, and demonstrates a degree of resilience in the world's second-largest economy.

This performance was largely driven by strong export momentum at the start of the year. However, indicators for March already show a slowdown, with more moderate growth in retail sales and industrial production, a sign that the recovery remains fragile.

The conflict in the Middle East now represents a major threat to the Chinese economic model, which is heavily dependent on international trade. As the world's largest energy importer, China is particularly vulnerable to soaring oil prices, which increase production costs and weigh on the profitability of industrial companies.

Beyond energy, reliance on maritime routes for exports and imports constitutes a structural vulnerability. Any sustained disruption to international trade could affect global demand and, consequently, China's economic performance, whose trade surpluses reach levels comparable to the size of some developed economies.

Faced with these uncertainties, the authorities may be forced to deploy new fiscal stimulus measures, particularly if the export slowdown is confirmed. The longer the conflict drags on, the greater the risks to growth become, placing Beijing before difficult economic choices in the coming months.