How is foreign trade performing this year? Yao Yang responds to Every Economist: Expects full-year export growth of no less than 5%, contribution rate to GDP growth may be lower than last year

Our reporter | Zhang Huai Shui Our editor | Bi Lu Ming

On March 24, the Boao Asia Forum 2026 Annual Conference, themed “Shaping a Shared Future: New Trends, New Opportunities, New Cooperation,” opened in Boao, Hainan.

According to the latest data released by the General Administration of Customs, in the first two months of 2026, China’s merchandise trade imports and exports increased by 18.3% year-on-year. In February alone, exports grew by 36.1% year-on-year, significantly exceeding market expectations. Against the backdrop of domestic demand being the main driver, what will be the trend of foreign trade this year? What role will foreign trade exports play in the “three engines” driving economic growth?

Yao Yang, Dean of the Advanced Finance School at the Water滴湖 of Shanghai University of Finance and Economics, told the “Daily Economic News” reporter (hereinafter referred to as “Our Reporter”) that in the first two months of this year, China’s foreign trade growth was indeed very high. Looking at the whole year, it is obviously not sustainable. “From the full year perspective, we expect export growth to be no less than 5% year-on-year. In 2025, China’s merchandise and service imports and exports contributed 1.7 percentage points to GDP growth, with a contribution rate of 20.9%. This year’s data might be a bit lower.”

Yao Yang further told Our Reporter that in 2025, foreign trade exports and imports exceeded expectations in boosting economic growth, returning to the level of the first decade of this century. Based on China’s economic development patterns, this state is unsustainable. “Last year, China’s trade surplus reached $1.2 trillion. Roughly comparing it to the GDP of various countries, it ranks around 15th in the world, which is clearly unsustainable. Therefore, this year, I hope the share of consumption can increase further.”

Our reporter noticed that the government work report this year listed “focusing on building a strong domestic market” as the top priority, proposing to adhere to domestic demand-led growth, coordinate promoting consumption and expanding investment, and explore new space for domestic demand growth.

According to data released by the National Bureau of Statistics, in 2025, fixed asset investment (excluding rural households) nationwide was 48.5186 trillion yuan, down 3.8% from the previous year. Among them, private investment decreased by 6.4%.

As an important support for expanding domestic demand, how can investment stabilize and recover in 2026? Yao Yang told Our Reporter that two indicators are very important. First, real estate must stabilize; sustained negative growth in real estate significantly hampers domestic demand recovery.

Yao Yang further pointed out that last year, local government finances faced certain pressures. He believes the central government’s goals are clear: first, stabilize the real estate market; second, resolve local government debt risks through special bonds. In 2026, he thinks this effort can be intensified. If real estate can be stabilized and local governments’ “three guarantees” (basic livelihood, wages, and operations) are maintained, the main goal of domestic demand-led growth can be achieved this year.

According to the data released in this year’s government work report, in 2026, 4.4 trillion yuan of local government special bonds are planned to be issued, with improvements to the management of negative lists for special bond projects and pilot self-review and approval, focusing on supporting major projects, replacing implicit debt, and clearing government arrears.

Our reporter found that the planned scale of local government special bonds in 2026 is the same as in 2025, maintaining a high level, reflecting the continued implementation of a more proactive fiscal policy this year.

Cover image source: AIGC