As China enters the first year of its 15th Five-Year Plan, policymakers are prioritizing underlying stability and balance over mere growth rates. Recent measures include targeted fiscal support and incentives for care services. This approach aims to foster sustainable development amid global uncertainties.
China's 2025 GDP figures reveal an economy more resilient than anticipated, signaling the initial outcomes of a strategic economic rebalancing. As the country launches into the first year of its 15th Five-Year Plan (2026-2030), the economic path is shaped more by intrinsic stability than headline growth rates.
Policymakers are refining their strategies, emphasizing the expansion of domestic demand, strategic investments in human capital, and fostering innovation to build enduring stability for sustained development. Wang Han of Industrial Securities said: "Evaluating 2026 requires a medium- to long-term view of structural change. The goal is to improve economic quality, not just chase a growth rate."
The central bank's recent moves illustrate this calibrated approach, with measured cuts to interest rates and mortgage requirements. Analysts at Nomura described them as "low-profile easing," intended to offer support without sparking excessive equity market speculation.
On the fiscal side, Vice Minister of Finance Liao Min stated on Tuesday that spending will expand further this year, directing more resources toward boosting consumption, human capital, and livelihood protections. Chris Sherrard, editor-in-chief of The Irish News, noted: "Recent policy signals tell a different story—one of strategic transformation, resilience and sustained fiscal progress."
Kang Yi, head of the National Bureau of Statistics, observed: "China is at a critical phase in the transition from old growth drivers to new ones. Emerging growth drivers are gaining momentum, which will help counter downward pressure and create impetus for growth."
The Central Economic Work Conference in December last year highlighted expanding domestic demand as the primary task for 2026. Wang Changlin, deputy head of the National Development and Reform Commission, announced on Tuesday that an implementation plan for the 2026-2030 domestic demand strategy will be released this year. Sectors like elderly care, green technology, and cultural tourism are poised for growth in services consumption.
Additionally, authorities extended tax and fee incentives for community and family services—such as elderly care, childcare, and domestic services—until the end of 2027. These include VAT exemptions on income, a 10 percent reduction in the taxable income rate, deed tax exemptions for related properties or land, and waivers for fees like property registration, aiming to cut operational costs and address population aging.
A key element is "investing in people," framing human capital as essential for innovation-driven growth. Zhang Jun of China Galaxy Securities said: "'Investing in people' is crucial for addressing broad systemic challenges."
Zhou Chen, an NDRC official, revealed plans to stabilize and expand employment, improve job quality, and raise urban and rural incomes. Su Jian, director of the China Center for Economic Research at Peking University, remarked: "China's advantage is evolving from a 'population dividend' to a 'talent dividend,'" leveraging the world's largest annual output of STEM graduates.
This rebalancing for intrinsic stability may define China's next development phase amid complex global challenges.
