China's economy is much weaker than the data would normally suggest, says Leland Miller

China’s economy faces a severe downturn as year-on-year data reveals a sharp decline across nearly every sector, despite misleadingly stable headline export figures. China Beige Book CEO Leland Miller highlights that while exports jumped 36% due to tech components, domestic retail sales have collapsed and travel spending has hit a four-year low. Upstream inflationary pressures in commodities and agriculture are beginning to squeeze corporate margins, signaling further distress for 2025. With the traditional growth model of infrastructure and exports reaching its limit, Beijing may be forced to abandon its "property bubble popping" policy to rehabilitate the real estate sector ahead of the politically sensitive 2027 leadership transition. Despite these economic vulnerabilities and recent purges within military leadership, a near-term invasion of Taiwan remains unlikely as the regime prioritizes internal stability and economic recovery over high-risk geopolitical conflict.