China Sets 2026 Growth Target at 4.5%–5% as Budget Stresses Targeted Support

Overview

• Premier Li Qiang unveiled the goal at the opening of the National People’s Congress, marking the lowest formal target since 1991 aside from 2020.
• Official guideposts set consumer inflation near 2%, an urban unemployment rate around 5.5%, creation of about 12 million urban jobs, and a 4% deficit‑to‑GDP ratio.
• Fiscal plans rely on 1.3 trillion yuan in central ultra‑long bonds and 4.4 trillion yuan in new local special bonds to fund infrastructure, consumption incentives and risk control.
• The government proposed lifting defense spending by roughly 7% to about 1.91 trillion yuan, a figure still subject to approval during the Two Sessions.
• Leaders cite weak demand, property strains and external trade risks after 2025 growth of about 5% with a record US$1.2 trillion trade surplus, while the draft five‑year plan prioritizes technology and consumption rebalancing.