A Chinese People’s Liberation Army (PLA) soldier stands guard outside the National Museum of China in Beijing on March 3, 2025, ahead of the country’s annual legislative sessions known as the “Two Sessions.”
Pedro Pardo | Afp | Getty Images
BEIJING – China’s top policymakers are expected to release growth targets and economic recovery plans for the year at an annual parliament session that begins on Wednesday.
Dubbed “Two Sessions,” the assembly will consist of a consultative congress, which will begin later in the day, and a National People’s Congress, which is scheduled to open on Thursday. Chinese Premier Li Qiang will announce a series of economic goals to the NPC, most of which were decided at a December meeting.
During the upcoming parliamentary session this year, policymakers are also expected to release details of a new five-year development plan, the 15th such program in China’s modern history. Investors will be looking for clues about how Beijing plans to realize its domestic technology ambitions.
The goals represent the penultimate step toward China’s 2035 goals, with a focus on achieving technological self-sufficiency.
Senior Chinese leaders, including top diplomat Wang Yi and heads of economic and finance ministries, typically speak to the press during the two sessions. The meeting usually lasts about a week and is expected to end on March 11 this year.
Asia Society analysts noted that China’s anti-corruption campaign has reduced the number of delegates attending the two sessions this year.
Here’s what economists expect from Prime Minister Li on Thursday:
GDP growth of around 4.5% to 5%
Several Chinese local governments have already lowered their growth ambitions for 2026, suggesting Beijing could follow the national target.
According to The Asia Society, a growth target of less than 5% would be the lowest on record and down from “around 5%” in the past three years. Due to the pandemic, China has not set a GDP target for 2020.
“A slightly lower target would give policymakers more leeway to prioritize structural reforms and improve data quality,” economists at the Economist Intelligence Unit said in a note last week, citing a 4.6% growth forecast.
However, Morgan Stanley analysts see a “low probability” that Beijing will set a smaller growth target, adding that policymakers typically set GDP ranges – rather than single-digit targets – during times of major economic stress. The company also noted that 2026 is the first year of China’s “15th Five-Year Plan,” which requires faster growth to boost confidence.
Inflation of around 2%
Budget deficit of 4%
Such a target would also be in line with last year’s, which marked a rare expansion in government spending as a share of GDP.
According to data accessed through Wind Information, the 4% deficit recorded in 2025 was the highest on record since 2010. The previous high was 3.6% in 2020.
Deeper challenges
China’s policy announcements will focus on details on consumer incentives, such as: B. the expansion of trade-in subsidies, and possible gradual support for the struggling real estate market are being examined. The two sessions are likely to shed light on Beijing’s thinking on the impact of US trade tensions and the evolving conflict in the Middle East.
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The world’s second largest economy faces ongoing challenges at home.
“There is a growing gap between Beijing’s goals (and data measuring economic performance) and Chinese policymakers’ actual ability to support domestic demand with the tools at their disposal,” Logan Wright, partner at U.S. research firm Rhodium Group, said in a report on Tuesday.
Wright added that China’s financial system lent heavily to unproductive local governments and state-owned enterprises to prevent them from collapsing – and that fiscal spending was largely carried out by the same institutions.
“The net result is a declining return in terms of investment and economic activity for the same volume of credit or fiscal spending, while private sector investment remains weak,” he said.