The global significance & value of China's economic targets for 2026

Editor's note: Hu Zhihao, research fellow of the Institute of Finance & Banking, Chinese Academy of Social Sciences (CASS), and deputy director of the National Institution for Finance & Development (NIFD). The article reflects the author's opinions and not necessarily the views of CGTN.

At the Two Sessions this year, the Chinese government officially set its annual economic growth target at 4.5% to 5%, with a commitment to strive for better results in practice. This pragmatic and resilient target is not only grounded in the overall framework of China's high-quality development but also closely aligns with the latest forecasts from international organizations. 

In the context of a sluggish global economic recovery, frequent geopolitical conflicts, and an intensifying restructuring of industrial chains, China's steady economic progress has extended beyond boosting its own development to becoming a core pillar for global economic stability and a catalyst for growth.

China has become the core engine of global growth

Since the beginning of this century, China's economic development has exerted an increasingly significant influence on the global landscape and remains the leading contributor to global economic growth, serving as an "anchor" against global economic volatility. 

China's GDP share of the global economy has risen from 3.6% in 2000 to 16.9% in 2024, maintaining its position as the world's second-largest economy. Since 2007, China's contribution to global economic growth has consistently ranked first. In particular, during the subprime mortgage crisis and the COVID-19 pandemic, China's resilient and positive growth became a stabilizing force for the global economy mired in negative growth. 

According to IMF research, China's expected growth rate of 4.5% or more in 2026 will contribute nearly 30% of global growth, an indispensable boost amid the sluggish global scenario. In the first two months of 2026, China's fixed asset investment increased by 1.8%, quickly recovering from the negative growth seen in the fourth quarter of the previous year.

China safeguards global supply chain security by leveraging its industrial chain advantages

As the core hub of the global value chain, China's manufacturing strength provides a solid foundation for global supply and serves as the key support for the stable operation of global industrial and supply chains. 

According to the United Nations Industrial Development Organization, by 2024, China's manufacturing value-added accounted for 32% of the global total, ranking first in the world for 15 consecutive years and contributing more than 30% to global manufacturing growth. 

Besides, China is the only country in the world with a complete industrial system, and its manufacturing advantage featuring comprehensive industrial chains, large-scale production, and high efficiency has effectively alleviated global inflationary pressures and supply shortages. 

Even during global supply chain disruptions, China has maintained stable production capacity output. In 2025, China's total goods trade exports exceeded 26.9 trillion yuan ($3.8 trillion), providing high-quality industrial products and daily necessities for countries worldwide and acting as a "stabilizer" for global supply. In the first two months of 2026, China's value added of industrial enterprises above designated size grew by 6.3%, 1.3 percentage points higher than the average growth rate of the fourth quarter of 2025, highlighting the resilience of its industrial sector.

China's strategic transformation will continuously stimulate domestic demand

With its enormous economic scale, China has become a core component of global total demand. The country's strategic shift from "investment in physical assets" to "investment in human capital" will further unleash domestic demand potential and inject strong momentum into weak global demand. 

Currently, China is the main trading partner of over 150 countries and regions, with its goods imports exceeding 18.5 trillion yuan in 2025, maintaining its position as the world's second-largest importer. China is also a core buyer of global agricultural products, energy resources, raw materials, and high-end consumer goods. That same year, China's services imports amounted to 4.45 trillion yuan, remaining the world's second-largest services importer. 

This year's Two Sessions explicitly proposed multiple measures to expand domestic demand and promote steady consumption growth. To this end, China is increasing investment in the livelihoods sector, focusing on expanding the middle-income group, improving residents' consumption capacity, and continuously optimizing and upgrading the structure of domestic demand. 

In the first two months of 2026, retail sales of consumer goods increased by 2.8% year-on-year, 1.9 percentage points higher than the growth rate in December 2025. The steady expansion of China's domestic demand market will directly drive global export growth, creating massive orders and job opportunities for businesses worldwide, becoming a key force in stabilizing global demand and promoting the rebalancing of the world economy.

New quality productive forces lead China in becoming one of the core drivers of global innovation

As the world's second-largest economy, China places cultivating new quality productive forces on its top agenda and adheres to an innovation-driven development model. It also actively develops emerging pillar industries and future industries, which not only contributes to upgrading its own economic structure but also reshaping the global innovation landscape and charting new paths for overcoming growth bottlenecks in the world economy. 

In recent years, China's total R&D expenditure has remained second in the world, reaching 3.92 trillion yuan in 2025. What's more, China remains home to the largest reserve of R&D personnel for several consecutive years, and its international patent applications have led the world for seven years. This innovation-centered development model drives global industrial upgrades and technological iterations, pushing the global economy toward a shift from traditional factor-driven growth to innovation-driven growth and fostering sustainable growth momentum for the world economy.

China on track to meet dual carbon commitments, empower global sustainable development

China is firmly committed to realizing its dual goals of carbon peak and carbon neutrality, and it has made significant achievements in green economic development. While maintaining economic growth, China has set an example for global sustainable development, driving the world economy toward a green and low-carbon transformation. 

By the end of 2024, China's installed capacity for renewable energy generation exceeded 2.34 billion kilowatts, accounting for more than 42% of the global total. It is also the first time that the installed capacity of wind and solar power has surpassed that of thermal power. Renewable energy has become the dominant source of electricity in China. China's new energy vehicle stock, installed photovoltaic capacity, and installed wind power capacity all rank first globally, and energy consumption per unit of GDP continues to decrease. 

The 2026 Two Sessions have set a target of reducing carbon dioxide emissions per unit of GDP by approximately 3.8%, fulfilling the country's climate governance responsibilities through practical actions. In the process of promoting global sustainable development, China's stable economic growth does not come at the expense of the environment. Instead, it is based on high-quality, green, and low-carbon growth. This offers the world China's solutions and wisdom for achieving economic sustainability.

The global value of China's economy lies not only in the resilience of its annual growth but also in the long-term certainty of its strategic direction. 

As the first year of the 15th Five-Year Plan, 2026 marks China's efforts to ensure a steady start and a strong foundation. Moreover, China is committed to maintaining economic growth within a reasonable range, achieving qualitative improvements, and ensuring moderate quantitative growth. This long-term, stable institutional advantage and development resilience position China as the "engine" and "stabilizer" of the global economy. By offering certainty in its own development, China is counteracting the uncertainties in the external environment and providing solid support for the global economy to navigate through economic cycles and sustain long-term growth.