China's economy has emerged from "zero-Covid" without the inflation that occured in some other major economies but with reduced consumption, minimal private investment growth, a weakened real estate sector, high youth employment, and constrained local government finances. Beijing is banking on a surge of new household spending and is planning only marginal new stimulus measures. Chinese leaders, however, are sending contradictory signals to entrepreneurs and foreign investors. China will almost certainly achieve its conservative growth target of 5 percent this year. But in the next few years, Beijing's prioritization of national security over economic reforms will pose a risk to China's economic trajectory.