Politburo Plans October 2026 Fifth Plenum, Pledges Faster Fiscal Spending; H1 Special Bond Sales Hit RMB2.07

The Political Bureau of the Communist Party of China Central Committee convened a meeting on July 30, deciding to hold the Fifth Plenary Session of the 20th Central Committee in Beijing in October 2026. The main agenda includes the Political Bureau reporting its work to the Central Committee and studying major issues concerning persistently advancing full and rigorous Party self-governance. The meeting also analyzed the current economic situation and mapped out economic work for the second half of the year.

The meeting observed that by balancing domestic and international imperatives and coordinating development with security, China's economy has shown momentum toward new growth drivers and structural improvement while effectively coping with various external shocks and internal difficulties. It pointed out the need to take seriously the difficulties and challenges in economic operations, remain confident, rise to the occasion, make good use of opportunities and advantages, and promote high-quality development on a steady and sustained path. The meeting made clear that the general tone of pursuing progress while ensuring stability will be upheld for second-half economic work, accelerate the shift from old to new growth drivers, fully leverage the effects of existing policies, promptly devise and introduce practical and effective incremental policies, intensify counter-cyclical adjustments, and strive for a good start to the 15th Five-Year Plan period.

On macro policy, the meeting called for making policy more effective. On fiscal policy, it demanded accelerating the pace of fiscal spending and bond fund utilization, effectively advancing the construction of major projects and the 'two new' initiatives, and ensuring basic living standards at the grassroots level. Since 2026, the National Development and Reform Commission, together with relevant industry authorities, has allocated a total of 800 billion yuan to support 1,417 major projects covering areas such as scientific and technological innovation, ecological conservation and restoration of the Yangtze River basin, major transport infrastructure along the Yangtze, urban underground pipeline networks, major water conservancy projects, the New International Land-Sea Trade Corridor, higher education upgrading, and the 'Three-North' shelterbelt program. Funds from ultra-long-term special government bonds supporting major project construction and equipment renewal have all been distributed, and 187.5 billion yuan for promoting trade-in of consumer goods have been allocated. The full-year equipment renewal funds totaling 200 billion yuan have been fully disbursed, supporting about 11,000 projects in 22 sectors.

In the 'two new' area, 294 critical core national standards were planned for formulation or revision and have all been released. For equipment renewal, 113 national standards on energy consumption limits, equipment energy efficiency, pollutants, and carbon emissions were introduced. For trade-in of consumer goods, 115 national standards covering home appliances, furniture, automobiles, kitchen and bathroom products were released. For recycling, 66 national standards on recovering used automotive power batteries, waste electrical and electronic products, and decommissioned photovoltaic modules were issued. In the first half, new special bond issuance reached 2.07 trillion yuan, with a progress rate of 47%. The 800 billion yuan in new-type policy financial instruments arranged at the start of the year remain to be deployed.

On monetary policy, the meeting called for comprehensively utilizing and adjusting monetary policy tools in a timely manner and optimizing fiscal-financial coordination policies to boost domestic demand. The Government Work Report proposed establishing a 100 billion yuan special fund for fiscal-financial coordination to boost domestic demand, combining instruments such as interest subsidies, loan guarantees, and risk compensation to support the expansion of domestic demand.

On the demand side to expand domestic demand, the meeting stressed effectively expanding domestic demand, specifying that high-quality supply should be expanded to meet the consumption needs of different groups, tapping the potential of service consumption, and steadily advancing the planning and construction of the 'six networks'. In the first half of 2026, consumption growth slowed to 1.3%, with sales of household appliances and audio-video equipment declining 7.4% year-on-year, furniture down 3.7%, automobiles down 12.6%, and building and decoration materials down 8.8%.

Vice Minister of Commerce Yan Dong stated that service consumption is both the ballast stone for current consumption boosting and the main engine for future consumption growth. Going forward, the Ministry will ensure the implementation of the 15th Five-Year Plan for Expanding Consumption, leverage the leading role of the service consumption working mechanism, and has already worked with relevant departments to issue policy documents on new growth points such as integrated railway-tourism, high-quality development of household services, and fostering the automotive aftermarket.

On April 21, the State Council released the Opinions on Advancing the Expansion and Quality Improvement of the Services Sector, setting a target for the sector's total scale to exceed 100 trillion yuan by 2030. On July 13, the State Council approved the 15th Five-Year Plan for Expanding Consumption, which sets a goal of China's total retail sales of consumer goods reaching around 60 trillion yuan by 2030, a steadily increasing share of per capita service consumption expenditure in per capita consumption expenditure, and in-depth promotion of 'artificial intelligence plus consumption'.

On the supply side of industrial development, the meeting stressed accelerating the building of a modern industrial system, explicitly requiring long-term and stable support for basic research, deeply implementing the 'artificial intelligence plus' action, developing new forms of the intelligent economy, improving the AI governance system, actively promoting breakthroughs in frontier technologies and the development of future industries, making efforts to build emerging pillar industries, and continuously promoting the transformation and upgrading of traditional industries. In December 2025, the Ministry of Industry and Information Technology and seven other departments jointly issued Implementation Opinions on the 'Artificial Intelligence + Manufacturing' Special Action. In April 2026, the Ministry of Education and four other departments jointly issued the Action Plan for 'Artificial Intelligence + Education'. In June 2026, the Ministry of Commerce and seven other departments jointly issued Implementation Opinions on Accelerating the Development of 'Artificial Intelligence + Consumption'.

On domestic reforms, the meeting emphasized the need to create a fair and orderly market competition environment, explicitly calling for formulating and implementing regulations on building a unified national market, continuing comprehensive rectification of 'involution-style' competition, normalizing the resolution of corporate payment arrears, deepening reform of state-owned assets and enterprises, optimizing the development environment for the private economy, and promoting the regulated and healthy development of the platform economy. On June 17, 2026, the State Administration for Market Regulation issued the Ten Norms on Subsidy Practices for Food Delivery Platforms (Draft for Comments). The administration further advanced the Action Plan for Standard Upgrading in the New Energy Vehicle, Lithium Battery, and Photovoltaic Industries, releasing 72 relevant national standards. On May 18, 2026, the Ministry of Industry and Information Technology issued the revised Implementation Measures for Capacity Replacement in the Steel Industry. On March 11, 2026, the Ministry of Industry and Information Technology and six other departments jointly issued the Action Plan for Accelerating the Renovation of Old Equipment in the Petrochemical and Chemical Industries (2026-2029).

On opening up, the meeting pointed out the need to expand space for mutually beneficial international economic and trade cooperation, explicitly calling for vigorously developing trade in services, promoting balanced trade development, improving the management system for outbound investment and the comprehensive overseas service system, and actively attracting and utilizing foreign investment. Meng Huating, head of the Department of Foreign Investment Administration of the Ministry of Commerce, stated that the government will steadily and orderly deepen opening-up trials in areas such as value-added telecommunications, biotechnology, wholly foreign-owned hospitals, and vocational training institutions, and accelerate the revision and release of regulations on mergers and acquisitions of domestic enterprises by foreign investors.

On preventing and defusing risks, the meeting stressed the need to effectively build a safety barrier, calling for stabilizing the real estate market, implementing a package of debt resolution measures, solidly advancing the reform and risk mitigation, capacity reduction, and quality improvement of local small and medium-sized financial institutions, deepening comprehensive reform of capital market investment and financing to enhance resilience and confidence, thoroughly investigating and rectifying all types of risk hazards, strengthening hidden danger inspections and management of hazardous reservoirs, river embankments, mountain torrent and geological disaster risk zones, and urban low-lying flood-prone points, and solidly carrying out flood prevention and emergency rescue and disaster relief work.

On agriculture, the meeting stressed unrelentingly doing a good job in 'agriculture, rural areas, and farmers', explicitly requiring continued consolidation and expansion of achievements in poverty alleviation, establishing sound mechanisms for the construction, operation, and maintenance of high-standard farmland, stabilizing the production and prices of live pigs and other agricultural and livestock products, promoting steady increases in farmers' incomes, ensuring the supply and price stability of agricultural inputs, doing a good job in agricultural production, and striving for bumper autumn grain and full-year grain harvests. On livelihood and green development, the meeting pointed out the need to strengthen livelihood protection through multiple measures, explicitly requiring greater employment support for key groups, safeguarding the rights and interests of workers in flexible and new forms of employment, ensuring services for the elderly and children, improving the tiered and categorized social assistance system, strengthening ecological and environmental protection, fighting the battle of the 'Three-North' program, and actively yet prudently promoting carbon peak and carbon neutrality.