Will the “Two Sessions” Lower the GDP Growth Target? 4.5% for 2026?

Chinese Premier Li Qiang, speaking on behalf of the CCP at the Two Sessions in 2024, told the Chinese people: We will meet again, and the future holds promise. (Video screenshot)

[People News] As March approaches, global financial markets and political-economic observers are turning their attention to Beijing. The Chinese Communist Party’s “Two Sessions” are set to convene in early March. Among the most closely watched figures at the meeting will be the GDP growth target for 2026.

According to the latest forecasts from economists at several financial institutions, Beijing may set this year’s growth target between 4.5% and 5%. Compared with the roughly 5% level maintained in recent years, this would represent a slight downward adjustment.

Why might Beijing choose to “slow down” at this moment? According to analysts at UBS Securities, this reflects several core challenges currently facing China. First is the shift in demographic structure—the fading of the labor dividend is an undeniable reality. Second is the continued tension in the global geopolitical and economic environment, with external trade conditions full of uncertainty.

Citigroup also predicts that China’s 2026 GDP growth target will be set between 4.5% and 5%. Andrew Tilton, Chief Asia-Pacific Economist at Goldman Sachs, believes that setting the target within this range would effectively ease pressure on local officials.

In fact, signs of a downward adjustment have already appeared at the local level. Data show that more than 10 provinces have already lowered their 2026 economic growth expectations during their local “Two Sessions.” UBS has even boldly predicted that China’s actual GDP growth in 2026 may slow to 4.5%.

However, there is another view in the market: in order to stabilize market and public confidence, Beijing may ultimately hold the target at around 5%. After all, psychological expectations can be just as important as actual economic performance.

In reality, under CCP control, any data can be adjusted for the sake of political stability. If top leaders want to see impressive economic figures, lower-level officials will comply in order to protect their positions. But now, China’s economy has declined to the point that even “beautified” data may no longer satisfy Xi Jinping.