The Bank of Finland’s BOFIT research unit published a forecast indicating that China’s actual GDP growth has likely been somewhat lower than official figures and will continue to slow over the forecast period. It expects growth, still supported by exports, to remain around 4 percent in 2026, then ease to around 3.5 percent in 2027 and about 3 percent in 2028, with no meaningful rebound in domestic demand. Official data show 5 percent annual growth in 2025 and in the first quarter of 2026, driven largely by strong exports while consumption and fixed investment remained subdued. BOFIT links weak domestic demand to a weaker employment outlook, the prolonged real estate downturn and higher household savings, and notes that China continues to produce much more than it consumes, with large public sector deficits and large trade surpluses expected over the next three years. The forecast also highlights China’s continued emphasis on exports and industrial policy, sensitivity to a global slowdown, and elevated uncertainty due to insufficient domestic reforms, limited reliability of economic data, censorship of economic discussion and rising geopolitical tensions.
Bank of Finland 2026-05-05
Bank of Finland forecasts China growth slowing to about 3 percent by 2028 as export momentum wanes
The Bank of Finland’s BOFIT research unit forecasts that China’s actual GDP growth has likely been below official figures and will slow from around 4 percent in 2026 to about 3 percent in 2028, with no rebound in domestic demand. Growth is expected to remain heavily export-driven amid weak consumption and investment, persistent real estate stress, large public deficits and trade surpluses, and elevated uncertainty linked to limited reforms, data reliability concerns and rising geopolitical tensions.