China Viewpoint: ‘Six networks’ to drive an investment upturn

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China Viewpoint: ‘Six networks’ to drive an investment upturn

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China Viewpoint

‘Six networks’ to drive an investment

upturn

We expect FAI to post positive growth in 2026 29 May 2026

China’s fixed‑asset investment (FAI) rebound in 1Q26 faltered in April, raising questions GEM Economics

about the durability of the upturn. We continue to expect FAI growth to turn positive this Asia | China

year after a -1.6% decline in January–April, but do not see this as a broad-based Xiaoqing Pi

recovery. Manufacturing capex should strengthen on firmer exporter sentiment, while Greater China Economist

infrastructure stabilizes on policy support. Property remains the key drag, and its Merrill+852 3508Lynch6584(Hong Kong)

ongoing contraction limits the scope of any cyclical rebound. xiaoqing.pi@bofa.com

Helen Qiao

The perfect storm is abating ChinaMerrill&LynchAsia Economist(Hong Kong)

The sharp downturn in 2H25 reflected a “perfect storm” of tightening local government +852 3508 3961

helen.qiao@bofa.com

finances, producer price deflation, weakening export sentiment, and the “anti‑involution”

campaign. These headwinds are easing: price pressures are less negative, trade tensions

have eased, and production discipline is softening. Even so, the recovery is partial. Previous reports in this series:

Construction-related activity remains weak, and local government balance sheets

continue to act as the binding constraint on investment. China Viewpoint: Unravelling China’s

investment downturn: (1) the factory

‘Six networks’ are the new policy lever woes 13 November 2025

The April Politburo meeting elevated water, power grids, computing networks, next-

China Viewpoint: Unraveling China’sgeneration communications, urban pipelines, and logistics networks to the core of the