China will set lower growth target for 2026 as economy slows, SCMP says

HONG KONG – China will set a lower economic growth target range for 2026 than 2025, the South China Morning Post reported, in a sign top leaders may refrain from measures to reverse a slowdown that intensified in recent months.

The growth target will be 4.5 per cent to 5 per cent in 2026, the newspaper reported, citing three unidentified sources briefed on the matter. That is down from a goal of “around 5 per cent” in 2025 and compares with a goal of 8 per cent as recently as in 2011. 

Policymakers likely agreed on the decision in December at a major planning conference in Beijing, but will not officially publicise the new objective until the annual session of China’s top legislature in March.

China’s gross domestic product expanded 5 per cent in 2025, data released last week showed, with record exports compensating for cooling private consumption and an unprecedented drop in investment. That lopsided growth model is expected to be harder to sustain in an era of rising protectionism across the world. 

President Xi Jinping has already hinted at his greater tolerance for slower growth, warning officials against “inefficient” investment. Among the steps taken so far to support the economy, the central bank delivered only targeted rate cuts while the Finance Ministry opted for incremental measures to encourage private borrowing. 

“With only mild fiscal and monetary measures at the start of the year, alongside the cancellation of some export tax rebates and tolerance for yuan appreciation, policymakers appear not very keen on pursuing strong near-term growth,” said senior China strategist at Australia & New Zealand Banking Group Xing Zhaopeng.

The Chinese authorities could set the growth target for the 2026-2030 period at 4.5 per cent to 5 per cent, he said, noting such a downward shift would align with a pattern seen since 2016, where each successive period has marked a lower stage of economic expansion.

For policymakers to reach their goal of making China a moderately developed economy by 2035, growth needs to average 4.17 per cent over the next decade.

Net exports contributed a third of economic growth in 2025, the statistics bureau said, the highest level since 1997. That uneven growth pattern will likely persist in 2026 because Beijing is unlikely to unleash massive stimulus as it continues to battle risks tied to local government debt. BLOOMBERG