China: Economy on firm footing at start of ’26 in World Economy News 31/03/2026 China’s industrial sector got off to a robust start in 2026, with profits of major industrial enterprises accelerating in the first two months of the year, underpinned by the strengthening of high-tech sectors and highlighting improving business conditions amid strong policy support, official data showed on Friday. Analysts said the upbeat figures add to a broader set of indicators suggesting China’s economy is gaining strong momentum at the start of the year, reinforcing expectations for a solid start to the 15th Five-Year Plan (2026-30) period as policymakers intensify efforts to stabilize growth and foster new growth drivers. They said the latest data point to a structural shift, with innovation pushing industrial enterprises toward higher value-added segments. They expect the recovery in corporate earnings to extend in the coming months, with momentum likely to underpin a broader economic rebound throughout 2026. Data from the National Bureau of Statistics showed on Friday that China’s industrial enterprises with an annual revenue of at least 20 million yuan ($2.89 million) saw their total profits jump by 15.2 percent year-on-year to 1.02 trillion yuan in the first two months of 2026, supported by the strengthening of the equipment manufacturing and high-tech sectors. The latest data mark a sharp acceleration from last year, when industrial profits edged up 0.6 percent for the whole of 2025. In December alone, profits increased 5.3 percent year-on-year. “Industrial enterprises saw a notable improvement in profitability in the first two months, with both profit and revenue growth accelerating, signaling that the industrial sector has exited its earlier softness and entered a phase of earnings recovery,” said Tang Guanghua, an analyst at Shenyin & Wanguo Futures. New growth drivers played a central role, as industrial profits showed clear signs of structural upgrading. Profits in equipment manufacturing industries surged 23.5 percent year-on-year during the first two months, 15.8 percentage points higher than that in 2025. Profits in high-tech manufacturing jumped 58.7 percent during the same period, accelerating by 45.4 percentage points from 2025, NBS data showed. “The recovery in industrial profits is no longer driven by traditional sectors, but increasingly led by new quality productive forces, with continued optimization of the industrial structure and improving growth sustainability,” Tang said. Wen Bin, chief economist at China Minsheng Bank, said industrial profits are likely to continue recovering, although at a more moderate pace. “On the one hand, pro-growth policies will continue to support industrial production and corporate revenues, providing a foundation for profit improvement,” he said. “On the other hand, rising external uncertainties, including geopolitical tensions, could affect global demand, supply chains and China’s exports, potentially increasing volatility in the recovery.” Policy support Looking ahead, experts expect policy support to remain a key pillar. Efforts to boost domestic demand and stabilize investment are likely to reinforce industrial production, while the strengthening of high-tech sectors will provide sustained momentum. “As the opening year of the 15th Five-Year Plan period, 2026 will see a raft of policy measures introduced in quick succession and translated into tangible development results,” said Pan Jiaofeng, pr