'Two Sessions': China reveals 2026 growth targets, policy focus in government work report

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Main targets in the 2026 government work report

• GDP growth: Around 4.5%-5%, with efforts in practical work to achieve better results
• Fiscal deficit ratio & size: Deficit ratio planned at around 4%; deficit of Yuan 5.89 trillion, up Yuan 230 billion from last year
• General public budget expenditure: To exceed Yuan 30 trillion for the first time, up about Yuan 1.27 trillion year on year
• Ultra-long special treasury bonds: Yuan 1.3 trillion to be issued to support "Two Major" initiatives (major national strategies and key security capacity building) and "Two New" initiatives (large-scale equipment upgrades and consumer goods trade-in programs)
• Special treasury bonds: Yuan 300 billion to be issued to support capital replenishment of large state-owned commercial banks.
• Local government special bonds: Yuan 4.4 trillion to be arranged to improve full life-cycle management of special bond projects and expand autonomous issuance pilots; focus on major projects, replacement of hidden debt, and settlement of government arrears
• Fiscal policy: Maintain an appropriate level of fiscal spending; continue optimizing expenditure structure; place greater emphasis on boosting consumption, increasing investment in people, safeguarding livelihoods, and improving the efficiency of fiscal fund utilization
• Monetary policy: Continue implementing a moderately accommodative monetary policy; prioritize stable economic growth and a reasonable rebound in prices; flexibly use policy tools including RRR and interest rate cuts; maintain ample liquidity
• Total social financing and money supply: Growth to be aligned with economic expansion and the targeted overall price level
• New urban employment: Over 12 million new urban jobs
• Surveyed urban unemployment rate: Around 5.5%
• CPI: Around 2%
• Per capita income growth: Growth in personal income to remain broadly in step with economic growth; implementation of urban and rural income enhancement plans
• Balance of payments: Basic equilibrium
• Grain output: Around 700 million tonnes
• CO2 emissions per unit of GDP: To decline around 3.8%

Key policy priorities in the 2026 government work report

Consumption

• Issue Yuan 250 billion of ultra-long special treasury bonds to support large-scale consumer goods trade-in programs
• Establish Yuan 100 billion in special fiscal-financial funds to promote domestic demand
• Improve the one-off credit repair mechanism
• Implement paid annual leave and staggered holiday arrangements

Investment

• Arrange Yuan 755 billion in central government budgetary investment
• Allocate Yuan 800 billion of ultra-long special treasury bond funds for "Two Major" initiatives
• Issue Yuan 800 billion in new policy-based financial instruments to leverage greater private and social capital participation

Real Estate

• Implement city-specific policies to stabilize volumes and prices
• Reduce inventory and optimize supply
• Explore multi-channel revitalization of existing commercial property
• Promote the development of safe, comfortable, green and smart "high-quality housing"
• Strengthen housing support for new urban residents, young people, and families with multiple children

Building a Unified National Market

• Strengthen anti-monopoly and anti-unfair competition enforcement
• Enhance review mechanisms for fair competition
• Utilize a comprehensive policy toolkit including macroeconomic regulation, standards setting, price enforcement, and quality supervision
• Address excessive "involution-style" competition

Developing New Quality Productive Forces

• Foster emerging industries including integrated circuits, aerospace, biomedicine, and the low-altitude economy
• Cultivate future industries such as next-generation energy, quantum technology, embodied intelligence, brain-computer interfaces, and 6G
• Deepen the "AI+" initiative to accelerate artificial intelligence integration across industries

Edited by Vivian Yang, yangzhenqi@mysteel.com