Beijing targets 6% GDP growth after containing coronavirus

China is targeting growth of at least 6% for the world’s second-largest economy this year, reflecting Beijing’s confidence in the wake of its successful containment of the coronavirus pandemic.

Speaking at the opening of the country’s annual parliamentary session on Friday, Premier Li Keqiang hailed China’s recovery after an “extraordinary” year and said the government wanted to create at least 11 million urban jobs. .

“Faced with the negative and serious impact of a sudden coronavirus epidemic and a deep global economic recession, we, the Chinese people. . . responded with extraordinary tenacity, ”Li told delegates.

Some 5,000 representatives have assembled in Beijing for the week-long session of the National People’s Congress, the Chinese parliament and a sister “consultative” assembly.

Despite the challenges posed by the pandemic, which caused the first year decline in economic output For decades in the first quarter of 2020, Li noted that 11.9 million urban jobs were created last year. Economic growth has also rebounded strongly, with the expanding economy 2.3% for the full year.

“A target of over 6% will allow all of us to devote all of our energy to promoting high-quality reform, innovation and development,” Li said. He added that the government was determined. to “maintain healthy economic growth” by launching a five-year plan focused on “autonomy” in critical technologies.

Ahead of this year’s parliamentary session, many officials and analysts had urged the government not to set an official growth target – a practice that has been widely criticized for leading to unnecessary spending. Last year’s economic recovery in China was mainly driven by investment and manufacturing rather than consumption.

Winking at those concerns, Li said the government deficit would be reduced to 3.2% this year, from 3.6% last year. This week, Guo Shuqing, one of the country’s most powerful economic leaders, warned of a potential “bubbles»Training in the country’s financial and real estate markets.

“The authorities are determined to deleverage the economy and reduce the risk of the financial system,” said Diana Choyleva at Enodo Economics. “The coronavirus has undone the gradual but good work of the past two years in pursuit of these goals.”

Jia Jinjing, professor of economics at Renmin University in Beijing, added that the government could not support the relatively loose fiscal and monetary policies it triggered in early 2020.

“Last year’s stimulus package was necessary to deal with the pandemic, it was not routine policy,” Jia said. “If we stick to easy fiscal and monetary policies, the government would be heavily burdened.”

However, the Chinese government has also pledged to meet the goal of doubling the size of the economy by 2035, with most analysts predicting average annual economic growth of 5% through 2025.

This year’s AFN session will also focus on ambitious climate goals, including reaching peaks in carbon dioxide emissions by 2030, and an electoral law designed to reduce the power of Hong Kong democracy activists within the territorial legislature and other local bodies.

Additional reporting by Xinning Liu in Beijing

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