Resume af teksten:
Kina har sænket sit BNP-vækstmål for 2026 til 4,5-5% efter tre år med mål på omkring 5%. Dette ændre signalerer en tolerance for langsommere vækst og en mulighed for at forfølge kvalitetsvækst, herunder reduktion af ineffektiv investering og forbedring af synergi. Budget- og obligationsudstedelsesmål forbliver stabile, hvilket viser regeringens tilbageholdenhed med at benytte ekstra stimulus. Bestræbelser for at booste indenlandsk efterspørgsel er prioriteret, med planer om at skabe en stærk hjemmemarked og oprette en 100 mia. kr. fond til forbruger kreditstøtte. Kina fortsætter med at åbne sin økonomi, især inden for tjenester og teknologi, og styrker nationale strategier som teknologisk selvstændighed og grøn udvikling. Udfordringen ligger i at styrke den indenlandske efterspørgsel med fortsat usikkerhed.
Fra ING:
China’s 2026 GDP growth target was lowered to 4.5-5%, after three straight years of “around 5%” targets. Most other targets were left unchanged. The slight softening shows that growth stability remains important, but steady fiscal targets are also signalling a reluctance to lean too heavily on fresh stimulus to bolster growth
China’s 2026 GDP growth target
GDP growth target lowered for 2026
China’s annual target-setting is always an important event. Since GDP growth targets were first published in 1990, China has fallen short of the target only a couple of times. Generally, betting on China to miss its target has been a losing bet for forecasters.
This year’s GDP growth target was reduced to 4.5-5.0%, a slight softening from the more ambiguous “around 5%” target set in the past three years. While it was debatable how much flexibility “around 5%” entailed, most market participants viewed this as within 0.2-0.3pp of 5%. With the new target, there appears to be a tolerance for slower growth, which should give policymakers more flexibility to pursue quality growth, a priority in recent years. Combined with China’s anti-involution drive, there will be a focus on reducing wasteful and duplicative investment while improving synergies and building on China’s long-term strategic direction. As the 15th Five-Year Plan has laid out, the key focuses are on improving industrial modernisation, improving technological self-reliance, and ramping up domestic demand.
With that said, the 4.5% threshold represents only a rather limited slowdown; China’s longer-term growth ambitions remain unchanged. The government work report outlined an intention for “laying a solid foundation for doubling per capita GDP by 2035 compared to 2020,” a key goal set by President Xi in the past.
The softer GDP target was in line with our expectations, as we had hints of this outcome earlier when various provinces also revised growth targets lower. Our GDP forecast for the year is 4.6% year-on-year, which would fall within this range.
China rarely falls short of its growth target
Other key targets mostly stable for 2026
There was little surprise in the other targets as well.
The inflation target, having been reduced to “around 2%” last year, remained unchanged. We expect inflation to rise this year to around 1% YoY, with the recent events in the Middle East potentially adding to upside risk on this number if supply disruptions persist. The inflation target has historically not been prioritised as aggressively as the GDP target, and the final level often deviates significantly from the target. As such, we don’t expect this to play a significant role in monetary policy decision-making, where we still see a case for further easing this year.
The employment target for new urban employment has been set at “around 12 million” since 2023, while the urban unemployment target was set at “around 5.5%” since 2021, and both targets have remained unchanged. There will likely be continued focus on improving employment conditions for youth, who have suffered a disproportionately high unemployment rate in recent years amid more cautious hiring.
The fiscal targets were arguably the only area where there was a more lively debate on whether or not we’d see adjustments. While the fiscal deficit-to-GDP target of around 4% was expected to remain the same, it was unclear whether we’d see a small uptick in the bond issuance targets. This hasn’t turned out to be the case, with another RMB 4.4tn of special local government bond issuance and RMB 1.3tn of ultra-long-term bond issuance targeted this year. The report also noted that the central government will ramp up fiscal transfers to the local government.
In our view, this suggests that while growth stability remains an important objective, the stable fiscal deficit and bond issuance targets indicate a degree of restraint, avoiding relying too much on extra stimulus to drive growth at the cost of growth quality. This may disappoint some watchers who had hoped for a stronger fiscal stimulus push. We believe there is still hope that the impact of fiscal policy could improve this year, with potentially more money available to go into the real economy rather than being used to bring off-balance-sheet debt onto the books. The government previously signalled its intent to stabilise investment growth in 2026 after 2025 saw a record low for fixed asset investment growth.
Growth target softened but other key targets left unchanged
The key focus this year will be on boosting domestic demand
The government work report also laid out the key objectives for the government in 2026.
In pole position is focusing on building a strong domestic market and boosting domestic demand. This sentiment has been repeatedly featured in past high-level meetings, and the government work report mentioned “special action to boost consumption” this year.
Trade-in policy scale pared down from RMB 300bn in 2025 to RMB 250bn in 2026. One of China’s flagship policies to boost consumption has been the trade-in policy, which has been successful in bolstering beneficiary categories in the past few years. However, the peak of the impact has passed, and it looks likely to move from tailwind to headwind this year.
Continued support for consumer credit: a RMB 100bn fund for promoting domestic demand will be established, aiming at facilitating loan interest subsidies and financing guarantees.
Investment will be funnelled into strategic priorities, while continuing to crack down on inefficient investment. RMB 7565bn of central government budgetary investment and RMB 800bn of ultra-long-term bonds will be allocated for projects to further the key national strategies and build out national security objectives.
Our bold call for China in 2026 could be coming to fruition as well. The government work report mentioned supporting eligible regions in promoting spring and autumn breaks for primary and secondary schools and implementing a paid staggered-leave system for employees. Staggering holidays could help bolster domestic tourism, which suffers from heavy overcrowding during national holidays, and help smooth overall consumption. We expect progress on this front to be incremental, but it is a positive sign nonetheless, as it is relatively low-hanging fruit.
Other than domestic demand, policymakers continue to prioritise creating new growth drivers through innovation and securing technological self-reliance. Key tech sectors such as AI, semiconductors, and cloud computing will likely continue to benefit from outsized investment.
Trade-in policy tailwinds could reverse in 2026 as scale is reduced
The next steps in China’s “high-level opening up”
China has come under increasing pressure from abroad, as its trade surplus surged to nearly USD 1.2tn in 2025 . In order to address these issues, there was mention of actively expanding imports to promote a more balanced trade development, as well as aiming to sign more bilateral trade and investment agreements. The stronger CNY thus far this year could help contribute to this process.
China continues to open up aspects of its economy. In 2026, the focus includes expanding market access for the services industries, where a pilot zone for the services sector opening up will be established. The government work report signals further opening up telecom, biotech, and healthcare sectors. There will also be pilot programmes to open up the digital sector. In order to continue to attract foreign investment, China will aim to guarantee national treatment for foreign investments and promote two-way investments.
China’s Five-Year Plan locks in on four strategic priorities for the rest of the decade
China’s Five-Year Plans often give insight into the longer-term priorities and can be seen as setting the framework for future policy direction.
For the current Five-Year Period of 2026-2030, the government work report highlights four strategic priorities:
Promote high-quality development: a focus on quality continues to emphasise scientific and technological innovation, building a modern industrial system focused on advanced manufacturing and green development. The plan targets the digital economy to reach 12.5% of GDP, and for R&D expenditure to grow by 7% per year over the current five-year period.
Strengthening the domestic economy: amid external uncertainties, strengthening domestic demand is of high importance. The plan calls for significantly boosting consumption, eliminating local protectionism, and investing in improving the goods and services sectors.
Promote common prosperity: encourage fertility and address population ageing, improve education, elderly care, promote quality employment, improve income distribution, and strengthen the social security system.
Coordinate development and security: targeting various aspects of national security, such as food security, energy security, and resolving key risks, such as the property market and local government debt.
What does this mean for China’s economy? The trends we have seen in the past few years are likely to continue, with an increased focus on moving up the supply chain and improving tech self-reliance. The big question mark will be how successful China is in boosting its domestic demand, as domestic confidence remains tepid and continues to restrain this effort.
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