China’s economy gains momentum on stronger growth drivers

August 26, 2026 (MLN): China's economy has maintained a broadly stable performance since the start of the year, with new growth drivers gaining momentum, industrial upgrading accelerating and major economic risks remaining under control, according to an assessment of the country's economic performance.

Under the leadership of the Communist Party of China Central Committee with President Xi Jinping at its core, authorities across the country have worked to counter external shocks and domestic challenges while continuing efforts to promote high-quality development.

The economy has consequently shown an improving structure, with emerging industries and technological innovation playing an increasingly important role in supporting growth, according to APP.

During the first half of the year, China's gross domestic product expanded by 4.7%, keeping the country among the faster-growing major economies globally. Prices showed signs of a reasonable recovery, employment remained broadly stable and the balance of payments stayed generally balanced.

Meanwhile, profits of industrial enterprises above designated size increased by 18.7%, while national general public budget revenue rose 4.7%, reflecting improvements in the performance of parts of the corporate sector.

China is currently undergoing a major transition in its development model, shifting from traditional growth engines toward innovation, technology and higher-value industries.

As a result, the assessment of the economy should extend beyond short-term movements in monthly and quarterly indicators and focus more closely on the quality and sustainability of growth.

Key indicators include technological progress, industrial upgrading, business vitality and the long-term resilience of the economy.

Technological innovation is increasingly being translated into industrial strength, with China recording advances in several strategic areas since the beginning of the year. These include progress in key technologies such as integrated circuits, innovative medicines and reusable rocket recovery.

New industries have also become a stronger source of economic momentum.

In the first six months of the year, value added in the equipment manufacturing industry increased by 9.3%, while high-tech manufacturing recorded growth of 13.3%.

Development in robotics and artificial intelligence continued to accelerate, supporting the expansion of products ranging from industrial and surgical robots to cleaning and bionic robots.

China's position within global industrial and supply chains has also strengthened.

Manufacturers in the Yangtze River Delta, for example, are able to source thousands of components for new-energy vehicles within hours, while industrial collaboration in the Pearl River Delta has helped establish an efficient supply ecosystem for humanoid robots.

The country's rapidly growing exports of intermediate goods are also supplying critical components to global manufacturers, supporting the stability and efficiency of international industrial and supply chains.

At the corporate level, digitalization and intelligent technologies are reshaping production models. Companies are increasingly using big data to identify market demand and artificial intelligence to improve production scheduling, allowing manufacturers to offer more flexible and customized products.

Digital systems are also connecting factories, logistics networks and consumer orders, enabling more automated and integrated production and delivery processes. These changes are helping companies shorten delivery times, expand their market reach and improve operational efficiency.

At the same time, risks within the economy are being addressed through ongoing reforms and targeted measures.

The property market has shown stronger signs of stabilization since the start of 2026. Transactions in the second-hand housing market have increased in several major cities, while housing prices have become more stable and inventory pressures have eased.

Efforts to manage local government debt have also continued, with existing hidden liabilities being replaced in an orderly manner and the number of local government financing platforms declining.

Reforms aimed at reducing risks in small and medium-sized financial institutions have progressed as well, contributing to a reduction in the number of high-risk institutions.

China has continued to focus on preventing new risks while gradually resolving existing vulnerabilities, with authorities seeking to maintain financial and economic stability and prevent systemic risks.

Confidence in China's long-term prospects has also been reflected in the interest of international businesses.

A recent delegation led by the China Council for the Promotion of International Trade visited the United States, where business representatives expressed interest in expanding cooperation in areas including advanced manufacturing, artificial intelligence, clean energy, quantum computing and life sciences.

Executives of several US companies operating in China also highlighted opportunities arising from policies aimed at expanding domestic demand, improving public services, strengthening livelihoods and enhancing local research and development capabilities.

Several multinational companies indicated plans to expand investment and business operations in the Chinese market.

China's long-term economic outlook continues to be supported by its vast consumer market, extensive manufacturing capacity, developed infrastructure, skilled workforce and comprehensive industrial and supply chain network.

These structural strengths, built over more than four decades of reform and opening-up, continue to provide a foundation for economic resilience and long-term development.

Looking ahead, the implementation of major projects under the central and local 15th Five-Year Plans for 2026-2030, together with more effective and timely macroeconomic policies, is expected to support economic activity in the second half of the year.

With new growth drivers continuing to emerge and structural reforms advancing, China's economy is expected to remain within a reasonable range and move toward achieving its annual economic and development targets.

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