Beijing: China on Thursday lowered its GDP target to 4.5 to 5 per cent for this year in the face of Trump’s trade tariff war, the worsening global crisis following the US-Iran war and headwinds in the domestic economy, owing to property market slump and unemployment crisis.
The target close to that of last year was announced by Chinese Premier Li Qiang in his work report presented to the annual National People’s Congress (NPC), the country’s parliament, which opened here on Thursday.
China has been setting a five per cent target for the GDP for the last three years amid growing domestic economic challenges. This year, the target is lowered to 4.5 per cent to 5 for the first time.
China’s economy grew by 5 per cent last year to $20.01 trillion, riding high on the robust exports despite US tariffs, while domestic consumption, its bugbear, remained sluggish.
Thursday’s opening session is being attended by President Xi Jinping and over 2,000 deputies.
Presenting his work report, an annual feature, Li said the government targets an economic growth of 4.5 per cent to 5 per cent this year and will strive for better in practice. Main targets for development this year also include: a surveyed urban unemployment rate of around 5.5 per cent, creation of over 12 million new urban jobs and an increase in consumer price index of around 2 per cent.
Li also spoke of growth in personal income in line with economic growth, basic equilibrium in the balance of payments, stable grain output of around 700 million tonnes and a drop of around 3.8 per cent in carbon dioxide emissions per unit of gross domestic product.
On the domestic demand, which remained stagnant for years, making China dependent more on its exports for its GDP growth, Li said China will actively boost consumption and implement an income growth plan for urban and rural residents.
The country will advance special initiatives to bolster consumption, with the roll-out of a range of practical measures to boost the earnings of low-income groups, increase property income, and refine the remuneration and social security systems in 2026. A total of 250 billion yuan (USD 36.17 billion) in ultra-long special treasury bonds will be earmarked for consumer goods trade-in programmes, and a special fiscal-financial coordination fund of 100 billion yuan will be created to facilitate domestic demand expansion, he said. Meanwhile, China hiked its defence budget to about 1.91 trillion yuan (USD 277 billion), an increase of seven per cent from last year in yuan terms, as part of its efforts to ramp up rapid modernisation of armed forces to catch up with the US military.