China is lining up a 5% GDP growth target for 2026, keeping the same number it used this year, according to government advisers and analysts. That target puts pressure on policymakers to keep fiscal spending and monetary easing wide open as they try to break a lingering deflation cycle. The goal is being shaped behind closed doors and is tied directly to the start of the 15th five-year plan, a period meant to reset the pace after years of strain across the economy. The 5% target is meant to give the new five-year plan a strong launch while officials try to shake off years of damage from a long property slump, soft consumer demand, excess factory capacity, and falling infrastructure-led investment. Leaders have already signaled a shift toward boosting household consumption and pushing structural economic change over the next five years. But advisers say those moves take time to work. For now, the short-term fix stays focused on government spending and central bank action. Beijing pushes fiscal and rate tools Most advisers who spoke allegedly said they back a 5% growth target for 2026. A smaller group suggested a slightly lower range of 4.5% to 5%. Top officials are expected to approve the final number at the Central Economic Work Conference later this month, where next year’s economic priorities will be locked in. The public will not see the target until March, when it is released at the annual parliament meeting. The advisers are not formal decision-makers and asked to stay unnamed because the talks are private. Their views closely match the wider consensus among private economists. Last year’s agenda-setting meeting ran from December 11 to December 12. One adviser allegedly said directly, “We should set a target of around 5% for 2026, the first year of the 15th five-year plan. There will be certainly challenges in achieving this, but there is room to maneuver with both fiscal and monetary policy.” Most of these advisers also want the budget deficit ratio to stay near 4% or slightly above. China already set a record 4% of GDP deficit this year to support growth. On the oil side, demand is not offering any near-term lift. Janet Kong, chief executive officer of Hengli Petrochemical International Pte, said oil demand will likely stay weak until at least the middle of next year. “It’s difficult to find a very bright spot unless the government rolls out new policy at beginning of next year,” Janet said on the sidelines of the Financial Times Commodities Asia Summit in Singapore. China remains the world’s largest crude oil importer, but slow growth, trade battles triggered by President Donald Trump, and the rising electrification of transport are holding back fuel use. Even petrochemicals, long seen as one of the few demand bright spots, are under pressure from overcapacity. Janet also pointed to a possible shift in global demand, saying oil demand may strengthen more in West of Suez markets than in East of Suez, with the United States and traditional OECD economies expected to see growth. Central bank and subsidies stay in play On the policy front, Citi analysts expect China’s central bank to restart interest rate cuts as early as January 2026, after its last cut in May. The period following the Central Economic Work Conference is also seen as a key window for another round of incremental property support. On the fiscal side, Citi said in a note that government bond issuance could once again be front-loaded in 2026, with a slow shift toward consumer support and welfare spending. The government is also expected to keep its consumer goods trade-in subsidies in place next year. Those subsidies totaled 300 billion yuan, about $42.43 billion, this year. Officials are discussing a possible shift of some funds away from goods and into services, but the overall support program is expected to remain active in 2026. Longer term, China faces a strict math problem. An official study tied to the five-year plan proposals said the country needs average annual growth of 4.17% over the next decade to double per capita GDP to $20,000 from its 2020 level. That milestone would mark a formal transition to what officials call a moderately developed country. Because of the slowing economy, policymakers are expected to keep ambitious annual growth targets over the next several years to protect policy flexibility later on, according to advisers and economists. At the same time, the new five-year plan, which will be released at the parliament meeting, is not expected to set a fixed growth target for 2026 through 2030, keeping the same practice used in the current plan. Don’t just read crypto news. Understand it. Subscribe to our newsletter. It's free .
