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Bullets:

China’s economy is the world’s largest by PPP and productive GDP measures.

National policymakers announced GDP growth for 2026 will be 4.5% - 5.0%, which is twice as fast as economic growth forecasts for the United States, and three times that of Europe.

China’s annual GDP targets are achieved, every year, because policies and trends are firmly in place to meet them, pre-announcement.

It is the Five- and Ten-Year Plans that are far more ambitious and consequential, and foundational to China’s long-term economic and industrial strategy.

Global business executives should pay far closer attention to China’s successes in achieving their long-term objectives, and build their corporate strategies accordingly.

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Report:

Good morning.

A few days ago Chinese policymakers announced their GDP growth target for the year, at 4.5 to 5%, “and will strive for better”. The reactions in Western media were predictable, and wrong. These headlines here are typical: China is guiding down its economic growth targets from previous years. The “lowest growth” in a generation, says the Economist.

Right away there are problems with that. These are the economic growth predictions from the IMF for 2026, with China at 4.2%. Among the G20, only India and Indonesia are forecast to grow faster. China’s economy will grow at least twice as fast as the United States, and three times faster than the European Union.

Then, when we measure by Purchasing Power Parity, which accounts for economic output based on local currencies, China’s economy is by far the biggest in the world, so whether China sees 4.2% or 4.5 % or 5% growth—they’re just running farther and faster ahead. Padding their lead:

There are other problems, though, with these shallow, simplistic reactions in our own media. One is that China hits its economic growth targets, no matter what gets thrown at them. This is what we learn when we read past the headline from CNN. The targets for the previous three years were “around 5%, despite COVID, and despite the newest trade wars from the Biden and second Trump administrations.

Even though a hot war is on in the Middle East, and kicked off even before the big meeting in Beijing, the Chinese are more confident, given that the Chinese are ringing up record trade surpluses, despite the high tariffs, which have just been struck down.

And another reason China is confident these growth targets can be hit, is that they probably already have. Their annual GDP growth targets are not stretch objectives. Above is an example of what we mean, this grain output target of “around 700 million tons.” In 2024, China produced 706 million tons of grain. And for next year, Chinese grain production forecast is 715 million tons. That estimate is from the US Department of Agriculture.

Our point here is that these GDP forecasts, released every year, represent what China’s leadership is almost certain will happen, with policies and trends in place to ensure it. It is much more useful to look at their long-range plans, the 5- and 10-year plans. Those are ambitious. Those are “stretch goals”. The Made in China 2025 industrial plan is an example of that.

This is the second time we’ve used this chart, and the second time I’m apologizing for it. It’s the worst-designed chart I’ve ever seen. If a viewer has to stretch and twist his neck to understand it, it should have a warning label. The inside ring is China in 2015, when Made In China 2025 was first announced. The middle ring is the progress made, industry by industry, by 2024. China is “competitive” or “global leader” in all but one of these most important strategic industries.

The objective of the policy was to make China a global leader in advanced manufacturing, while reducing the country’s reliance on foreign technologies. China has been mostly successful.

This is a chart of China’s import dependency. In biotech, down slightly. In every single other industry, China is far less dependent on foreign companies, by large double-digit percentages:

What’s more, China has created reverse dependencies – now global firms are reliant on Chinese companies and manufacturing, and those dependencies are growing.

The booms in China’s innovation and technologies are self-reinforcing; “technological leadership could accelerate” further.

And the the foundation for all of it is China’s monopolies over global supply chains, which means that the industries that will power the future are reliant on Chinese supply chains and factory sectors.

Business executives should ignore the headlines of China’s GDP growth targets. Those are already hit, like a company that knows its own order book and can closely forecast what their revenues will be for the next quarter. What is far more important is that China declared that they will be competitive in all those 13 strategic sectors by 2025, and lead the world by 2030, and they’re on track to meet those targets too.

Be Good.

Resources and links:

The Entire Global Economy in 2026 in One Chart (GDP, PPP)

https://www.visualcapitalist.com/the-global-economy-by-ppp-2026/

Charted: The 2026 Growth Outlook for G20 Nations

https://www.visualcapitalist.com/cp/charted-the-2026-growth-outlook-for-g20-nations/

Was Made in China 2025 Successful?

https://rhg.com/research/was-made-in-china-2025-successful/

China’s 2024 grain output tops 700 mln tonnes, a record high

https://english.www.gov.cn/archive/statistics/202412/13/content/_WS675c1266c6d0868f4e8edecc.html

Record grain harvest forecast for China

https://www.world-grain.com/articles/22355-record-grain-production-forecast-for-china