BAKU, Azerbaijan, January 2. China’s economy is projected to sustain strong growth in 2026, driven by fiscal and monetary policy support, alongside a reduction in trade-related pressures, Trend reports via the Organization of the Petroleum Exporting Countries (OPEC).
Following robust growth in the first half of 2025 and the third quarter, China’s economic momentum is expected to remain resilient in the coming year. This outlook is bolstered by anticipated continued policy support and the recent trade agreement between the United States and China, which has successfully reduced the effective tariff rate from nearly 40% to below 30%.
OPEC observes that the tariff reduction is likely to alleviate export pressures, narrow China’s competitive gap with other ASEAN exporters, and provide short-term support to economic activity. However, the agreement’s one-year suspension period indicates that trade tensions may persist beyond the immediate future.
From a policy perspective, OPEC emphasizes that China’s recently unveiled 15th Five-Year Plan (2026–2030) prioritizes the expansion of domestic demand and a strategic shift towards fostering local consumption. The plan reaffirms the long-term goal of doubling GDP by 2035, which implies an average annual real growth rate of approximately 4.4% from 2025 to 2035. Key measures outlined in the plan include strengthening social safety nets, improving income distribution, supporting high-quality employment, and ensuring equitable access to public services.
Meanwhile, the property sector has shown renewed weakness, with October data pointing to softer housing activity and prices. OPEC notes that authorities may consider additional support measures, including potential mortgage interest subsidies, to help moderate the downturn.
Both the manufacturing and services sectors are projected to sustain robust growth, underpinned by supportive policy measures and a gradual shift in export orientation toward non-U.S. markets. The People’s Bank of China (PBoC) has signaled a continued easing stance, although any additional action will remain contingent on economic data, particularly if growth remains close to the 5% target.
The most recent PMI data for November reveal mixed performance across sectors. The Manufacturing PMI dipped to 49.9, down from 50.6 in October, while the Services PMI held steady in expansionary territory at 52.1, reflecting sustained growth momentum in the services sector.