BEIJING, China – Premier Li Qiang revealed ambitious economic targets for China, aiming for a 5% growth rate this year amidst challenging circumstances. During his speech to the annual session of the National People’s Congress, Li outlined strategies to invest in advanced technology, strengthen the military, and support economic growth. However, there was no major stimulus package announced to boost markets and alleviate concerns among investors.
In efforts to achieve growth, Li proposed issuing long-term bonds amounting to 1 trillion yuan in the coming years, with an initial issuance of 1 trillion yuan this year. These funds are intended for implementing national strategies and enhancing security in crucial areas. Additionally, plans were introduced to introduce a new development model in the housing market, including the construction of government-subsidized housing to alleviate the ongoing real estate downturn impacting the economy.
Acknowledging the challenges ahead, Li emphasized the need for a stable foundation for China’s economic recovery, pointing out issues like insufficient demand, industry overcapacity, and weak social expectations. The government’s budget draft included a 7.2% increase in defense spending to address security concerns and support economic stability.
With China’s economy growing at a 5.2% rate last year, a significant improvement from a 3% rate in 2022, replicating the same growth rate this year presents additional challenges due to starting from a higher base. Li highlighted the difficulty in achieving targets such as income growth, job creation, and energy efficiency, as well as the reduction of energy consumption.
As China’s leadership focuses on raising consumer spending and driving economic growth, challenges remain due to falling housing prices and jobs uncertainty. The government pledged to address risks in the housing market and assist local governments facing financial strains from pandemic-related expenses and reduced revenues.
Despite the challenges ahead, Li urged greater confidence in China’s economic potential, citing the vast market size, advanced manufacturing capacity, and abundant workforce. Plans for encouraging consumer spending, employment support, and assistance to financially distressed local governments were among the initiatives outlined in Li’s report.
As China navigates economic uncertainties, the government remains committed to providing support and stability to ensure sustained growth. Li’s proposals reflect the leadership’s determination to bolster the economy and address key issues affecting the country’s development. The ongoing session of the National People’s Congress serves as a platform to showcase achievements, rally support for policies, and reinforce confidence in China’s economic outlook.