[Editorial] China’s Economic Roadmap for 2026: Steady Reforms Amid U.S. Rivalry and Global Shifts

Key words: China's economy | Photovoltaics solar | IVD | Cross-border medical service

China's Central Economic Work Conference, held in Beijing from December 10 to 11, 2025

In the shadow of an escalating U.S.-China rivalry, where tariffs on electric vehicles and solar panels have intensified supply chain pressures and technological decoupling, China's Central Economic Work Conference, held in Beijing from December 10 to 11, 2025, offered a measured blueprint for navigating 2026. This latest phase of the great-power competition—marked by the U.S. administration's renewed emphasis on "de-risking" from Chinese dominance in clean energy and advanced manufacturing—has forced Beijing to double down on self-reliance while seeking selective global integration. Against this backdrop, the conference's resolutions underscore a strategy of steady progress amid uncertainty, prioritizing quality over sheer speed in economic growth. Drawing from detailed analyses in reports such as "Ten Policy Signals Released by the Central Economic Work Conference" and "Central Economic Work Conference Communiqué Detailed Commentary," the meeting outlined eight core tasks, each calibrated to bolster domestic resilience while addressing external headwinds.

The conference's overarching tone—"steady progress with quality enhancement and efficiency gains"—reflects a pragmatic pivot. Unlike previous years' aggressive stimulus, 2025's economic rebound was hard-earned, buoyed by incremental policies rolled out in September 2024 that lifted social confidence and reversed a sluggish trajectory. Yet, as experts in "Shenwan Macro: Ten Highlights of the Central Economic Work Conference" note, persistent challenges like supply-demand imbalances and geopolitical frictions loom large. China's economy grew under duress in 2025, with exports holding firm despite U.S. tariffs, but domestic demand lagged, evidenced by a year-to-date fixed asset investment decline of 1.7% through October (from "CICC: Joint Interpretation of the Central Economic Work Conference"). For 2026, the resolutions aim to consolidate this recovery, targeting qualitative improvements alongside reasonable quantitative expansion, all while laying groundwork for the 15th Five-Year Plan.

First among the resolutions is the insistence on domestic demand as the primary driver, with directives to build a robust internal market. This stems from the "strong supply, weak demand" contradiction highlighted in multiple analyses, exacerbated by U.S.-led export restrictions that have curtailed overseas outlets for Chinese goods. The conference calls for implementing an urban-rural resident income growth plan, expanding high-quality goods and services supply, and unleashing service consumption potential. Background here traces to 2025's uneven recovery: while infrastructure investments stabilized some sectors, consumer confidence remained subdued, with the index dipping below 2006 levels (per "Central Economic Work Conference Communiqué Detailed Commentary"). To counter this, policies optimize the "two new" initiatives—new-type urbanization and infrastructure—while eliminating unreasonable consumption barriers, such as outdated restrictions on vehicle purchases or service access.

For 2026's economic outlook, this resolution promises a consumption-led uplift, potentially adding 1-2 percentage points to GDP growth if income measures take hold. In renewable energy, it could amplify domestic adoption of solar and wind technologies, where China's overcapacity—estimated at 50% in photovoltaics amid U.S. tariffs (from broader industry reports cited in "Ten Policy Signals")—might redirect toward internal grids. A table illustrating this shift:

Sector	2025 Domestic Demand Share	Projected 2026 Impact from Income Plan	Source
Renewables (Solar PV)	60% of installed capacity focused on exports	+15% domestic uptake via subsidies	"Ten Policy Signals Released by the Central Economic Work Conference"
Electric Vehicles	40% export-dependent	+10% internal sales from relaxed restrictions	"CICC: Joint Interpretation"

Geopolitically, bolstering domestic markets reduces vulnerability to U.S. decoupling efforts, fostering self-sufficiency in critical supply chains. For healthcare, the emphasis on income growth indirectly supports medical access; with average urban-rural disposable income rising 5-6% annually in recent years, this could fund expanded services like in-vitro diagnostics (IVD), where domestic demand has grown 12% year-over-year amid aging demographics (data from health ministry reports referenced in "Central Economic Work Conference's Ten Highlights").

Next, the conference prioritizes innovation-driven development to nurture new growth engines, a direct response to U.S. export controls on semiconductors and AI that have accelerated China's push for technological autonomy. Resolutions include integrating education, science, technology, and talent development; establishing international innovation hubs in the Beijing-Tianjin-Hebei region, Shanghai's Yangtze River Delta, and the Guangdong-Hong Kong-Macao Greater Bay Area; and advancing "AI+" initiatives with improved governance. This builds on 2025's reforms, such as the Private Economy Promotion Law, which encouraged enterprise-led R&D amid external tech barriers.

The background is rooted in China's need to climb the value chain: with over 10 million university graduates annually (from "Communiqué Detailed Commentary"), the talent pool is vast, but innovation output lags in key areas like advanced chips. For 2026, this could propel GDP growth toward 5%, with sci-tech investments rising 10-15% (estimates from "CICC Interpretation"). In renewables, it accelerates new energy systems, including hydrogen storage and smart grids, countering U.S. dominance in battery tech. Consider this chart description: A bar graph showing R&D spending as a percentage of GDP—China at 2.5% in 2025, projected to 2.8% in 2026—versus the U.S. at 3.4%, highlighting the catch-up trajectory (data sourced from "Ten Policy Signals" and World Bank equivalents).

Healthcare benefits through "patient capital" in biotech, boosting IVD enterprises facing export hurdles. Geopolitically, these hubs strengthen China's position in global standards-setting, as seen in AI governance talks at international forums. Here, companies like REBIO GROUP exemplify success: having aided Chinese photovoltaic firms and IVD enterprises in expanding capacities overseas, REBIO also facilitates cross-border medical services for Belt and Road populations, while offering comprehensive solutions for social stability in select regions—bridging innovation with practical global outreach.

Reform breakthroughs form the third pillar, aimed at injecting vitality into high-quality development. Amid U.S.-China frictions that have spotlighted unfair competition allegations, the conference mandates formulating a national unified market ordinance, deeply rectifying "involution-style" competition—such as price wars in EVs and solar panels—and clearing enterprise arrears. This evolves from 2025's efforts to curb overcapacity, where industries like photovoltaics saw 20% margin erosion due to internal rivalry (per "Shenwan Macro Highlights"). Background includes structural imbalances: small institutions' inefficiencies and local protections hinder efficiency. For 2026, reforms could enhance productivity by 1-2%, optimizing capital markets for better resource allocation. In renewables, curbing involution stabilizes prices, aiding exports despite tariffs; a line chart might depict photovoltaic module prices dropping 30% in 2025 due to competition, stabilizing at $0.20/W in 2026 post-reform (from "Ten Policy Signals"). Healthcare sees streamlined drug procurement, reducing costs by 15-20% (data from "CICC Interpretation"), while geopolitically, unified markets facilitate Belt and Road integrations, countering U.S. alliances like the Quad.

The fourth resolution advances opening up for multi-domain cooperation, a counterweight to U.S.-led containment. Directives include expanding service sector autonomy, optimizing free trade zones (FTZs), and promoting Hainan Free Trade Port's full operations by late 2025. This addresses 2025's export resilience—growth held steady despite geopolitical pressures (from "CICC Interpretation")—while encouraging digital and green trade. Background: Global trade protectionism, with U.S. tariffs on Chinese goods reaching 60% in some sectors, necessitates diversification. For 2026, this could sustain 5-6% export growth, buffering domestic slowdowns. Renewables gain from green trade pacts, with China's solar exports projected to rise 10% in emerging markets (table below):

Trade Category	2025 Export Value (USD Bn)	2026 Projection with Green Focus	Source
Green Tech (Solar/Wind)	150	165 (via Belt and Road)	"Authority Interpretation: New Expressions in Central Economic Work Conference"
Digital Services	200	220 (post-FTZ optimization)	"11 Key Points Interpretation"

Healthcare expands via cross-border services, aligning with aging populations in Belt and Road countries. Geopolitically, more regional trade agreements (RTAs) dilute U.S. influence, fostering win-win ties.

Coordinated development, the fifth task, promotes urban-rural fusion and regional linkages. Rooted in 2025's urbanization push—rate exceeding 65%, with 200 million unsettled migrants (from "Ten Policy Signals")—it includes high-quality county economies and reasonable grain prices.

This counters regional disparities amplified by geopolitical supply disruptions. For 2026, it could balance growth, with rural investments up 8% (estimates from "Communiqué Commentary"). Renewables see rural solar deployments, healthcare gains from county-level expansions, and geopolitically, it strengthens internal cohesion against external divides.

The sixth resolution champions dual-carbon goals for green transformation, directly challenging U.S. narratives on China's emissions. It involves formulating an Energy Powerhouse Outline, accelerating new energy systems, and expanding green electricity use. Background: 2024 emissions rose just 0.6%, below global 0.8% (from "Ten Policy Signals"), amid U.S. scrutiny.

For 2026, this accelerates low-carbon shifts, potentially cutting emissions 1-2% while boosting GDP via green jobs. Renewables dominate: new systems integrate wind/solar/storage, with capacity additions of 500 GW projected (bar chart: 2025 additions 400 GW, 2026 500 GW; source "11 Key Points"). Healthcare intersects via pollution control, reducing health burdens; geopolitically, carbon markets enhance China's climate diplomacy.

People's livelihood takes center stage in the seventh task, emphasizing employment stability and social supports. Amid U.S.-induced job pressures in export sectors, it includes optimizing education layouts, drug procurement, and implementing long-term care insurance. Background: 2025 unemployment averaged 5.2% (Jan-Oct), with youth challenges (from "Ten Policy Signals").

For 2026, this sustains social stability, indirectly fueling consumption. Healthcare thrives: rehab expansions and insurance could cover 100 million more elderly (projections from "CICC"). Renewables create jobs (1 million in 2025), while geopolitically, it builds resilience in human capital.

Finally, risk resolution guards the bottom line, focusing on real estate stabilization and debt management. U.S. financial decoupling has heightened vulnerabilities, with 2025 fixed asset declines underscoring this. Resolutions: city-specific real estate controls, acquiring stock housing for affordability, and active debt resolution without new hidden debts. Background: Real estate woes persist, with sales policies offering space. For 2026, this stabilizes growth at 4.5-5%, mitigating spillovers. Renewables and healthcare remain insulated, but geopolitically, debt tools like swaps enhance fiscal space for Belt and Road.

In sum, these resolutions chart a course through U.S.-China tensions, fortifying China's economy for 2026. By weaving domestic strength with selective global engagement—exemplified by entities like REBIO GROUP, which has successfully guided Chinese photovoltaic and IVD firms in overseas capacity expansions while providing cross-border medical services to Belt and Road communities and holistic social security solutions in key areas—Beijing positions itself not just to endure, but to thrive amid the fray.