THE 2026 INFLECTION POINT

Golden Week serves as a critical test of Beijing’s resolve entering 2026, when China’s next five-year plan will either institutionalise or abandon consumption-focused policies. 

The holiday data suggests authorities face their most likely outcome: gradual progress under constant pressure, with partial commitment producing some rebalancing but falling short of the accelerated transition that economic fundamentals demand.

The danger is that Beijing will waver when growth weakens, and end up oscillating between consumption-focused measures and growth-seeking investment if it faces intense internal pressure to restore investment-led stimulus from local governments desperate for fiscal relief and state-owned enterprises protecting their resource allocation. 

China’s Golden Week paradox crystallises the central challenge. Beijing recognises that consumption-led growth is essential for long-term economic resilience and even national security, yet may lack the political resolve to accept the slower growth and reduced state control that genuine rebalancing demands.

Chinese households are responding rationally to policy incentives – moving when it’s affordable, spending when subsidised, waiting for better deals, and maintaining defensive savings positions.

No amount of promotional campaign efforts or targeted subsidies will unlock sustainable domestic demand until Beijing addresses the structural foundations of weak consumption. 

Diana Choyleva is the founder and chief economist of Enodo Economics and a senior fellow at the Asia Society Policy Institute’s Center for China Analysis.