SINGAPORE: China will target economic growth of “around 5 per cent” this year for the third consecutive time, according to the annual work report – seen by CNA – that Chinese Premier Li Qiang will deliver at the opening of China’s annual Two Sessions.
China’s economy expanded by 5 per cent in 2024, with gross domestic product (GDP) reaching 134.9 trillion yuan (US$18.77 trillion).
While China has maintained the same growth target since 2023, achieving it this year will require overcoming mounting external threats and domestic pressures.
On the foreign front, a trade war is escalating, with the US doubling duties on Chinese goods to 20 per cent, effective Mar 4.
Beijing has retaliated with additional tariffs of up to 15 per cent on American agricultural and food products from Mar 10. This is on top of tariffs announced last month, including 15 per cent on US coal and liquefied natural gas.
Back home, the world’s second-largest economy is grappling with sluggish domestic demand, a prolonged property sector crisis, an ageing population and rising youth unemployment.
Reflecting weak consumer demand, Beijing has slashed its consumer price index (CPI) target to around 2 per cent, markedly down from last year’s target of 3 per cent. This also marks the first time the CPI target is set below 3 per cent, since China started specifying the figure in the annual work report 20 years ago.
The adjustments come after its CPI, a key inflation measure, rose only 0.2 per cent in 2024 and 2023 – the lowest increase since 2009.
The Chinese government also announced a record budget deficit of around 4 per cent of GDP this year.
