BEIJING: China set its 2026 economic growth target at 4.5 to 5 per cent, marking the first cut since 2023, according to the government work report reviewed by CNA on Thursday (Mar 5).
The target was set at “around 5 per cent” in each of the past three years.
The move signals a more cautious outlook as the world’s second-largest economy grapples with deflationary pressures, a protracted property downturn and heightened trade tensions with the United States.
Chinese Premier Li Qiang is set to deliver the government work report shortly at the opening session of the National People’s Congress (NPC).
China’s economy grew 5 percent in 2025, one of the slowest rates in decades according to official data released in January, reaching more than 140 trillion yuan (around US$20.3 trillion) – as officials struggled to overcome persistently low consumer spending and a debt crisis in the country’s property sector.
This year carries added significance as the country embarks on its ambitious 15th Five-Year Plan, a blueprint that will set policy priorities and shape economic strategies through 2030.
“Beijing will stay the course with Xi’s agenda of slower but more secure growth, focused on technological self-reliance and tighter political control,” Neil Thomas, a fellow on Chinese politics at the Asia Society Policy Institute’s Center for China Analysis, previously told CNA.
Deflationary pressures have gripped China’s economy – underscoring challenges facing policymakers.
The producer price index fell 1.4 per cent in January from a year earlier, its 40th consecutive month of contraction, though the pace of decline has eased from the 2.6 per cent drop recorded for all of 2025.
Consumer inflation was flat in 2025 – well below the government’s 2 per cent target.
Price pressures showed little improvement at the start of this year. The consumer price index rose 0.2 per cent in January from a year earlier, slowing from 0.8 per cent in December.
The property sector, once accounting for roughly a quarter of China’s GDP, remains in a prolonged downturn.
Real estate investment fell 17.2 per cent in 2025, while commercial housing sales by floor area dropped 8.7 percent.
New housing starts are still far below peak levels, observers said, with excess inventory weighing on prices in many Chinese cities.
https://www.channelnewsasia.com/east-asia/china-two-sessions-economy-gdp-target-15th-five-year-plan-5969961
