According to a report by China Daily on March 6…
China’s decision to set a GDP growth target of around 4.5–5 percent for 2026 reflects a balancing act between maintaining stable economic expansion and accelerating the transition toward a more consumption-driven growth model, according to international economists.
The target was announced in the annual Government Work Report delivered by Premier Li Qiang at the opening of the session of the National People’s Congress in Beijing on Thursday. The report outlines the country’s economic priorities for the year and signals the policy direction as China enters the next stage of its long-term development strategy.
A Target Aligned With Long-Term Development Goals
Analysts say the growth target reflects both the scale of China’s economy and its broader development ambitions.
Radhika Desai, a professor at the University of Manitoba in Canada, described the target as “reasonable both quantitatively and qualitatively”.
She noted that growth of around 4.5–5 percent is consistent with China’s long-term objective of doubling its 2020 per capita GDP by 2035, a milestone aimed at reaching the income level of a moderately developed economy.
Given the combination of geopolitical tensions and domestic economic adjustments, Desai added that the target could even be considered relatively ambitious.
Beyond the headline figure, she said the policy documents emphasize high-quality growth, including stronger support for domestic consumption, the green transition and the development of new productive forces driven by advanced technologies.
Slower Growth Reflects Economic Scale
Some international observers have characterized the target as modest compared with the double-digit growth rates that China achieved in earlier decades.
But economists note that such comparisons overlook the dramatic expansion of the country’s economic base.
Marc Ostwald, chief economist and global strategist at ADM Investor Services International in London, said lower percentage growth rates are natural for a much larger economy.
“If an economy grows at 10 percent when it is worth $1 trillion, that is far smaller in absolute terms than growing at 5 percent when it is worth $10 trillion,” he said.
From that perspective, China’s current growth target still implies a substantial increase in economic output each year.
Consumption Takes a Larger Role
Another key message from the Government Work Report is the continued shift toward domestic consumption as a primary driver of growth.
According to the report, China plans to expand policies aimed at boosting household spending, including efforts to raise household property income and expand programs that encourage consumers to trade in older appliances and vehicles for newer products.
Economists say such policies reflect Beijing’s longer-term goal of rebalancing the economy away from investment-heavy growth toward consumption and services.
Innovation and Technology Remain Central
At the same time, the government continues to emphasize technological self-reliance and innovation-driven development.
China has identified scientific and technological advancement as a strategic priority, with investment expected to continue flowing into emerging industries such as advanced manufacturing, digital technologies and green energy.
Desai said the push for technological innovation and the expansion of consumption should be seen as mutually reinforcing.
Investment in new industries, she noted, can generate higher productivity, create jobs and ultimately support rising household incomes—thereby strengthening the foundation for consumer demand.
Room for Structural Adjustment
Allan von Mehren, chief analyst and China economist at Danske Bank, said a moderately flexible growth target also gives policymakers greater room to pursue structural reforms and address financial risks.
Rather than focusing solely on headline growth, he said the strategy allows China to prioritize economic restructuring, risk management and long-term sustainability.
Taken together, the policy signals suggest that Beijing’s approach is shifting from maximizing growth speed to ensuring steady expansion while upgrading the quality and resilience of the economy.