China likely case 5% GDP growth in 2026

China is likely to stick to its current annual economic growth target of around 5% next year, government advisers and analysts said, a goal that would require authorities to keep fiscal and monetary spigots open as they seek to snap a deflationary spell. The target would be part of Beijing's efforts to start a new five-year plan on a strong footing and shake off the effects of a prolonged property slump, weak consumer demand, excess factory capacity and declines in infrastructure-led investment. Most government advisers who spoke to Reuters said they favoured a 2026 growth target of around 5% - the same as this year, with a minority proposing a slightly lower 4.5% 5%. Top leaders are expected to endorse the target at the annual Central Economic Work Conference later this month, where priorities for the coming year will be set. The growth target will not be announced publicly until the annual parliament meeting in March. The advisers do not take part in decision-making and spoke on condition of anonymity due to the closed-door nature of the discussions, and their proposals generally reflect the consensus among private economists. Last year, the agenda setting meeting was held from December 11 to 12."We should set a target of around 5% for 2026, the first year of the 15th five-year plan," said one adviser. "There will be certainly challenges in achieving this, but there is room to maneuver with both fiscal and monetary policy. Most advisers are calling for the annual budget deficit ratio to remain at 4% or slightly higher. China set a record budget deficit target of around 4% of GDP this year to support its growth goal. "For fiscal policies, government bond issuance could again be front loaded in 2026, with a gradual shift towards consumer support and welfare spending," they said in a note. The government is expected to maintain its consumer goods trade in subsidies - totaling 300 billion yuan ($42.43 billion) this year - in 2026, amid expectations that some funds could be shifted from goods to services. China needs average annual growth of 4.17% over the next decade to double per capita GDP to $20,000 from its 2020 level, a milestone that would mark its shift to a "moderately developed country," according to an official study outlining the five-year plan proposals.