China’s First Investment Decline in 30 Years: What It Means for Global and Omani Investors
Investment in China experienced a sharp decline in November, pushing the country closer to its first annual decrease in more than three decades. According to the National Bureau of Statistics, fixed-asset investment—which includes housing, public infrastructure, and manufacturing—fell by 2.6% from January to November. The research firm Capital Economics reported an 11.1% year-on-year drop in investment for November alone, marking the second consecutive month of double-digit decreases in 2024.
This downturn signals a historic investment slowdown for China, where fixed-asset investment had consistently risen every year since the late 1980s, coinciding with rapid economic growth. The decline, which began in the second half of the year, reflects increasing caution about the country’s economic outlook.
Real estate investment, a major growth driver, continued to fall sharply in November. Public infrastructure and manufacturing investments also dropped, resulting in declines across all three primary sectors of fixed-asset investment—a rare occurrence that highlights multiple underlying issues affecting the economy.
China is grappling with a deep-rooted real estate crisis that has eroded market confidence. The property slump has strained local government finances, limiting their ability to fund infrastructure projects. Additionally, Beijing’s regulatory efforts to reduce excessive competition have slowed factory investments, even within fast-growing industries.
At a Monday press conference, Fu Linghui, spokesperson and chief economist for the National Bureau of Statistics, noted that despite the overall downturn, investment in key areas such as clean energy technology continues to grow, helping to build a foundation for medium- to long-term economic growth.
Chinese authorities have emphasized stabilizing investment and reversing the recent declines as priorities for 2026. However, Zichun Huang, a China economist at Capital Economics, cautioned that while policy support might spur a partial recovery in the coming months, China’s economic growth is expected to remain weak throughout 2026.
Additional indicators point to ongoing economic sluggishness. Retail sales, a key measure of consumer spending, rose by only 1.3%—the slowest pace in nearly three years.
The property sector remains under significant pressure. China Vanke, one of the country’s largest property developers, failed to secure approval for a plan to delay repayment of a bond due on Monday, bringing the company closer to default. In a filing with the Hong Kong Stock Exchange, Vanke stated it has a “grace period” of five working days after a missed payment and plans to convene another bondholder meeting during this time.
This article originally appeared in The New York Times.
Special Analysis by Omanet | Navigate Oman’s Market
China’s sharp investment slowdown, especially in real estate, infrastructure, and manufacturing, signals a major economic caution that could ripple globally, including Oman. For Omani businesses, this highlights the risk of decreased demand in Chinese markets and disrupted supply chains, but also the opportunity to explore alternative trade partnerships and invest in sectors like clean energy, which China continues to support. Smart investors should monitor China’s policy shifts closely while diversifying portfolios to mitigate exposure to the slowing Asian economy.
