China’s cabinet has set out a fresh package of measures intended to strengthen demand and keep the economy on course for its 2026 growth objective, placing faster bond use and an earlier start for major projects at the centre of its approach.
At an executive meeting on 28 September, chaired by Premier Li Qiang, the State Council said it would intensify counter-cyclical macroeconomic adjustment in response to problems emerging in the economy’s operation. The stated aim is to support sustained improvement and meet the country’s annual economic and social development goals.
The move comes against a backdrop of slowing momentum. China has set a 2026 growth target of 4.5 to 5 per cent. Gross domestic product expanded by 4.7 per cent in the first half, while growth in the second quarter was 4.3 per cent. Recent weakness in industrial production, retail sales and investment, alongside a prolonged property downturn, has increased the importance of whether previously announced support translates into activity.
Faster financing and a larger project push
The meeting called for the issuance and use of different types of government bonds to be accelerated. That is significant because approving borrowing is only one part of fiscal support: funds must also be allocated, projects prepared and work begun before spending can affect demand.
Ministers also urged an earlier start for major projects identified under the 2026–2030 five-year plan and the “six networks” initiative. The initiative covers water systems, new power grids, computing capacity, next-generation communications, urban underground pipelines and logistics. The cabinet additionally highlighted renovation and upgrading of ageing reservoirs and grain depots.
Those priorities combine conventional infrastructure with systems intended to support power transmission, digital capacity and the movement of goods. The emphasis on project commencement, rather than only longer-term planning, suggests that the pace of implementation is being treated as a near-term economic issue.
Support for investment and household demand
The State Council said policy would seek both to expand effective investment and to boost consumption. Measures identified in the meeting included interest-rate subsidies, infrastructure upgrades and targeted support. It also called for better project preparation, stronger protection for the land, financing and other inputs projects require, and faster investment approvals.
The consumption element matters because stronger investment alone would not resolve weak household spending. The cabinet said it would continue to examine measures to lift domestic demand, with scope for places able to do so to test supporting approaches first. Its stated direction also includes policies intended to promote employment and income growth, which are closely linked to consumers’ capacity to spend.
No new nationwide consumption target or value for additional spending was set out at the meeting. That distinction is important: the announcement is a policy direction and an instruction to improve delivery, not a fully costed stimulus programme with a published timetable.
Fiscal, monetary and property measures
On public finances, the cabinet called for expenditure to be optimised and for unused local-government debt capacity to be used more effectively. It also said monetary policy tools should be adjusted when appropriate. The meeting did not announce a change to benchmark interest rates.
It pledged increased relending support for scientific and technological innovation, technological transformation, agriculture and small businesses. Relending programmes can direct lower-cost central-bank funding through financial institutions towards specified areas, making their effectiveness dependent on the detailed terms and take-up that follow.
The cabinet will also study and introduce measures aimed at stabilising the property market. With employment, household income, housing and private investment all referenced, the meeting presents the challenge as broader than a single sector.
The practical test will now be the speed at which bonds are deployed, schemes are specified and projects start. The meeting set a clear policy direction, but it did not disclose additional borrowing totals, project-by-project allocations or dates for the prospective housing and income measures. Those subsequent decisions will determine the scale and timing of the support.
