China’s Economy Expands 4.7 Percent Despite Growing Global Uncertainty

Dragon Media News Desk

China’s economy expanded by 4.7 percent in the first half of 2026 despite intensifying geopolitical tensions, international trade disputes, volatility in global energy markets and growing uncertainty across the world economy.

According to preliminary data released by China’s National Bureau of Statistics on Wednesday, the country’s gross domestic product reached 69.57 trillion yuan between January and June. Calculated at constant prices, the figure represented year-on-year growth of 4.7 percent and remained within the government’s annual growth target of 4.5 to 5 percent for 2026.

China’s economy grew by 5 percent in the first quarter, while growth moderated to 4.3 percent in the second quarter. However, the economy still expanded by 0.9 percent in the second quarter compared with the previous three-month period.

By sector, the value added of the primary industry reached 3.15 trillion yuan during the first six months, representing annual growth of 3.7 percent. The secondary industry expanded by 3.9 percent to 25.05 trillion yuan, while the tertiary industry, which includes services, grew by 5.2 percent to 41.37 trillion yuan.

The tertiary industry accounted for 59.5 percent of China’s total economy and contributed 66.1 percent of the country’s economic growth during the first half of the year.

Mao Shengyong, deputy head of the National Bureau of Statistics, said achieving growth of 4.7 percent was a significant accomplishment for an economy of China’s size.

According to Mao, China’s economy expanded by approximately 3.6 trillion yuan compared with the same period last year, marking the largest first-half increase recorded during the past five years.

Mao said the moderation in second-quarter growth was mainly related to short-term domestic factors and external pressures. However, he stressed that the foundations of stable economic operation, industrial upgrading and the transition toward higher-quality development remained unchanged.

The first-half data indicated that high technology, the digital economy, advanced manufacturing and green industries are playing an increasingly important role in China’s economic growth.

The value added of major industrial enterprises increased by 5.4 percent, while high-tech manufacturing output expanded by 13.3 percent.

The value added of the equipment manufacturing sector grew by 9.3 percent. Production of three-dimensional printing equipment increased by 48.5 percent, lithium-ion battery output rose by 39.3 percent and industrial robot production expanded by 28 percent.

The figures indicate that China is accelerating its transition from traditional manufacturing-based growth toward a structure driven by technology, automation and green production.

Growth in the semiconductor industry was particularly notable. During the first six months, China’s major industrial enterprises produced 279.8 billion integrated circuits, an increase of 23.1 percent from the previous year. This was equivalent to average daily production of more than 1.5 billion chips.

Officials attributed the expansion to increasing demand for high-performance computing chips, memory chips, intelligent vehicle equipment and digital infrastructure associated with artificial intelligence.

Production of 5G smartphones, service robots, three-dimensional printing equipment and other intelligent products also continued to expand rapidly. The daily volume of tokens processed through China’s digital services reportedly reached hundreds of trillions, highlighting the rapid development of the country’s digital and intelligent economy.

Green transformation has also become an important source of economic momentum. New-energy vehicles accounted for more than 60 percent of China’s retail vehicle market for three consecutive months during the first half of the year.

Amid the expansion of clean-energy projects, production of nuclear power generation equipment increased by 92 percent, while hydropower generation equipment output rose by 51.9 percent.

Preliminary estimates indicated that new economic forces associated with high technology and digital production contributed more than 40 percent of overall economic growth during the first six months.

Within the industrial sector, high-tech manufacturing and digital product manufacturing accounted for nearly half of total industrial growth.

Foreign trade also provided significant support to the Chinese economy. China’s total trade in goods increased by 16.9 percent to 25.47 trillion yuan during the first half of the year.

Exports rose by 13.4 percent to 14.73 trillion yuan, while imports expanded by 22.1 percent to 10.74 trillion yuan.

Trade with countries participating in Belt and Road cooperation increased by 14.8 percent. Imports and exports by private companies expanded by 17 percent and accounted for 57 percent of China’s total foreign trade.

Exports of mechanical and electrical products increased by 20.1 percent.

On the domestic consumption front, total retail sales of goods and services expanded by 2.7 percent. Within that figure, retail sales of services increased by 5.3 percent, while retail sales of goods rose by 1.1 percent.

The separately measured total retail sales of consumer goods increased by 1.3 percent to 24.87 trillion yuan.

Online retail sales of goods and services rose by 5.2 percent to 10.07 trillion yuan during the first six months. Sales of communication equipment increased by 14.4 percent, while retail sales of smart wearable devices, including intelligent glasses, more than doubled.

Despite the positive indicators, several challenges remained. Fixed-asset investment declined by 5.7 percent during the first half of the year.

Investment in property development dropped by 18 percent, private-sector investment fell by 8.5 percent and infrastructure investment decreased by 2.4 percent.

However, investment in high-tech industries increased by 4.6 percent, while investment in intellectual property-related production expanded by 9.4 percent.

Investment in aerospace equipment manufacturing rose by 23.3 percent, information services investment increased by 15.5 percent and investment in lithium-ion battery manufacturing grew by 24.4 percent.

China’s consumer price index increased by 1 percent during the first six months, while core inflation, excluding food and energy prices, stood at 1.2 percent.

The surveyed urban unemployment rate averaged 5.2 percent. In June, the unemployment rate declined to 5 percent.

Per capita disposable income increased by 5.2 percent in nominal terms and by 4.2 percent after adjustment for inflation.

Real per capita income in rural areas grew by 5.5 percent, while real urban income expanded by 3.4 percent.

China regards 2026 as the opening year of its 15th Five-Year Plan period. The government has placed the expansion of domestic demand, promotion of consumption, development of high-tech industries, construction of new infrastructure and the digital and green transformation of traditional industries at the centre of its economic policy.

Economic growth of 4.7 percent in the first half, expanding industrial production, rapid development of technology-driven growth forces and strong foreign trade have provided China with a solid foundation for achieving its annual economic target.

However, additional targeted policies may be required to address the imbalance between domestic supply and demand, weak investment in the property sector and an increasingly complex external environment.

Overall, despite some moderation in the second quarter, technological transformation within China’s economic structure is creating new foundations for long-term growth.

The expansion of artificial intelligence, semiconductors, clean energy, advanced manufacturing and digital services is gradually shifting China’s economy away from a model dependent on traditional investment and property development toward one driven by innovation and high-quality development.