As China’s provincial legislatures wrap up their annual sessions, a growing number of regions—including some of the country’s economic heavyweights—have dialed back their growth targets for 2026. The question now is whether Beijing will follow suit when the National People’s Congress convenes in March, or maintain its national economic growth target at 5%.
Guo-Chen Wang, an Associate Research Fellow of the China Economic Research Institute at the Chung-Hua Institution for Economic Research (CIER), notes that the widespread downward revisions in local growth expectations reflect intensifying pressure on the real economy. The central government will likely adopt a “range-based” approach, setting the GDP growth target between 4.5% and 5%. With consumer recovery remaining weak, investment momentum fading, and exports slowing since the second half of last year, all three major economic engines are under simultaneous pressure, making the 5% growth rate a highly challenging upper bound.
Three Major Economic Engines Weakening: Export Gains Unlikely to Repeat
Wang further points out that China’s economy managed to maintain approximately 5% growth in 2025 primarily by relying on its trade surplus. However, with pushback against Chinese exports mounting in U.S. and European markets and trade barriers heating up, export momentum in 2026 will likely prove difficult to replicate. If local economies continue to weaken, the pressure to achieve established growth targets will concentrate even more heavily on the central government.
Additionally, the local downward revisions to GDP expectations reflect structural problems, including land development approaching its limits, insufficient foreign investment momentum, and tightening local government finances. Wang believes the central government may support growth through expanded spending or policy stimulus in the future, but the actual effectiveness remains to be seen. Overall, given unfavorable domestic and international conditions, the risk of a downward revision to China’s economic growth remains high, and the full-year performance should be viewed with caution. Author: CIER Editorial Team
Date: February 6, 2026