China's 2025 Secondary Industry GDP Share Plunges to 32.8%; Deep Real Estate Slump and PPI Deflation Trigger Structural Upheaval

China's Tertiary Industry GDP Share Returns to 61.4% High, Driven by Digital Services and Domestic Demand Recovery

Core Overview: Service Sector Makes Strong Comeback, Share Breaks 60% Mark According to the latest DataTrack data, in 2025, China's tertiary industry (service sector) share of GDP reached 61.4%, a significant recovery of 5.2 percentage points from 56.2% in 2024. This not only repaired the previous year's pullback but also approached the high levels of 2019. Although China's overall GDP achieved the 5.0% growth target in 2025, and the secondary industry (manufacturing, construction) maintained 4.5% growth supported by exports, the tertiary industry outperformed the broader market with a higher growth rate of 5.4%, re-establishing its status as the core engine of economic growth. Key Details: Digital Economy Leads, Real Estate Remains a Drag Detailed data shows distinct divergence within the service sector. Modern service industries related to "new quality productive forces" performed remarkably, with information transmission, software, and information technology services growing by 11.1% year-on-year, and leasing and business services growing by 10.3%, indicating strong demand for corporate digital transformation. Conversely, the traditional pillar industry of real estate remains in an adjustment period, with real estate development investment falling by 17.2% for the full year, posing a certain drag on the overall service sector. However, the moderate recovery of the consumer market (total retail sales of consumer goods grew by 3.7%), particularly the rebound in catering and service-oriented consumption, effectively filled the gap left by real estate. In-depth Attribution: Dual Effects of Policy Guidance and Structural Transformation Institutional analysis points out that the sharp rebound in the tertiary industry's share reflects the effectiveness of China's economic transformation towards "high-quality development." According to interpretations by McKinsey and official think tanks, although the share of the service sector temporarily declined in 2024 due to the strong recovery of export-oriented manufacturing, the policy focus shifted in 2025 to expanding domestic demand and developing the digital economy, prompting an accelerated release of high-value-added service industry output. Furthermore, as manufacturing automation increases (employment in the secondary industry declines), labor continues to flow into the service sector, supporting the expansion of the tertiary industry from the supply side. Outlook and Risks: A Safe Haven Amidst Trade Barriers? Short-term (1-2 months): Benefiting from the Lunar New Year effect, contact-intensive service industries such as tourism, catering, and entertainment will see a seasonal peak, which is expected to further consolidate the service sector's share in the first quarter. Medium-term (3-6 months): Close attention must be paid to changes in the external trade environment. If Western countries impose additional tariffs on Chinese manufacturing products (such as Trump 2.0 risks), it may suppress secondary industry growth, passively pushing up the tertiary industry's share; however, if the trade war spreads to logistics and financial services, it may create headwinds for the service sector. Strategically, it is recommended to focus on digital services and elderly care/healthcare sectors that possess "internal circulation" attributes. Web Search References https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQFKPNbE1ImiwgIBQvs7IUnfOwkk8IQdPkKR7srUiH-d2aLGb1wD87WDgR2V_tv3bcXvGrlUTNvnaGosWZeHDJioh-uj8OoZDMlF870M2gnn3Q99OPjuJi5ccwiNJleq3JtWbPeYUczyW5wXqAEh0BtVGM9KvdxEguNJoiJSKtVlyZkQhjYr1PSRm0o= https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQFaoYoWihdFdfR06xIXCQ8Mi69grGxapGBrsqan6EvzSV3fhCLbUARnXqzu5ZnbcUgNYxyMQtl95KDucyXPE32ku92QEyiFd0KOVfcqH4SdKLyHbTD3iCgjg1qIpcWP-3-GwwFTIJITSe2SC25H5QQs4F7uLbJs8J0LhVHuCgjp07woWIIkFm2QfyTEKKIEtFqNpohXsPfT9Aw= https://vertexaisearch.cloud.google.com/grounding-api-redirect/AUZIYQHpCE7JrwjHVDKJpxL75585oQ6Lceo_ml6AjytAYmabkbbStu1JwOZ1IAAWxBzzQYmAV_fsiTK_W6KYsXd86S9yK3XsHCBW2lO8qPWkwnpmrcuZqqzEmsWuXVCKcJb_WrgKaPkdFeedVhx97_8=