Despite facing multiple challenges in 2025, China's economy demonstrated remarkable resilience while pursuing high-quality development. The Fourth Plenary Session of the 20th CPC Central Committee and the Central Economic Work Conference injected strong momentum into this transformation. Against this backdrop, how should we assess China's current economic landscape, and what will be the key growth drivers in 2026? Insights from eight leading chief economists provide an in-depth analysis.
**Economic Resilience in 2025** Since December, several international institutions have revised upward their forecasts for China's economic growth. The IMF now projects China's 2025 GDP growth at 5%, up 0.2 percentage points from its October estimate, while the World Bank adjusted its forecast to 4.9%, a 0.4-percentage-point increase from June.
Wen Bin, Chief Economist at China Minsheng Bank, noted that despite external shocks, China's economy has shown robust resilience this year. Proactive fiscal policies and accommodative monetary measures bolstered domestic consumption and investment, while diversified strategies maintained export growth within a stable range, resulting in better-than-expected overall performance.
Luo Zhiheng, Chief Economist at Yuekai Securities, highlighted two standout factors: stronger-than-anticipated exports, with China's global export share continuing to rise amid external pressures, and a capital market rebound driven by regulatory reforms and improved risk appetite—particularly in tech stocks. With GDP growing 5.2% year-on-year in the first three quarters and Q4 projected at 4.6%, full-year growth is likely to meet the 5% target.
Lian Ping, President of Guangkai Research Institute, emphasized that China's 2025 socioeconomic goals are on track to be achieved, laying a solid foundation for 2026. Luo added that while challenges persist, China's vast domestic market, complete industrial system, and technological innovation capabilities remain long-term advantages.
**Fiscal-Monetary Policy Synergy in 2026** Economists widely expect fiscal policy to expand further in 2026, prioritizing human capital investment and consumption support.
Li Zhan, Chief Economist at China Merchants Fund, projected the fiscal deficit ratio to range between 4.0%–4.2%, with special bond quotas potentially rising to ¥4.5–4.7 trillion. Ultra-long special bonds (¥1.5–1.7 trillion) may continue funding strategic infrastructure and emerging industries, lifting the broad fiscal deficit ratio to around 9%.
Huang Wentao, Chief Economist at CSC Financial, suggested maintaining a deficit ratio above 4%, with broad measures reaching ~8.8%, while directing spending toward human-centric sectors. Wen Bin stressed that 2026—the first year of the 15th Five-Year Plan—requires robust countercyclical policies to stabilize expectations amid global uncertainties.
Monetary policy is expected to stay accommodative. Dong Zhongyun, Chief Economist at AVIC Securities, foresees 10–20 bps rate cuts and a 50-bps reserve requirement ratio (RRR) reduction in 2026, alongside targeted lending support. Li Zhan predicted rate cuts of 10–20 bps, likely in H1. Lian Ping emphasized flexible liquidity tools to sustain credit growth and stabilize markets.
**Service Consumption as a Policy Focus** The Central Economic Work Conference reiterated prioritizing domestic demand. Li Zhan noted that expanding consumption helps mitigate external risks like trade tensions.
Economists identified service consumption as a 2026 priority. Luo Zhiheng proposed extending subsidy programs from goods to services, while Huang Wentao suggested increasing ultra-long bond allocations for service sectors. Ming Ming, Chief Economist at CITIC Securities, stressed enhancing residents' purchasing power and refining policies like equipment upgrades and trade-in programs to boost efficiency.
Looking ahead, Yang Delong, Chief Economist at Qianhai Open Source Fund, anticipated steady policy support and economic recovery, with emerging industries—semiconductors, AI, biotech, and robotics—remaining growth highlights amid industrial transformation.
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