The Chinese government expressed its confidence on Monday in being able to achieve the economic growth objective for this year, of “around 5%”, and generate 12 million new jobs, after having dismantled the “Covid zero” strategy.
The authorities have not announced details of spending or other measures to boost growth, which fell to 3% last year, the second slowest pace in more than 40 years.
The target of “about 5%” was announced by outgoing Premier Li Keqiang at the opening of the plenary session of the National People’s Congress (NPC) on Sunday.
These efforts to reactivate the Chinese economy have global implications, since the Asian country is the main market for various raw materials and value-added products.
In recent years, for example, China has absorbed almost a third of Brazilian exports.
“We have various political ‘tools’ in our toolbox,” Li Chunlin, vice chairman of China’s Development and Reform Commission, the country’s top economic planning body, said at a news conference on the sidelines of the annual session. of the NPC. . .
The work report, delivered Sunday by Li Keqiang, was brief and gave few details, suggesting the Communist Party will wait until the new premier and executive ministers are appointed this month to announce details on fiscal policy, regulations, subsidies and other changes. .
The plenary session of the highest Chinese legislature is the last in a five-year political cycle guided by the congresses of the Communist Party (CPC), the only party in power in the country.
The 20th CPC Congress, which was held last October, reshuffled the Party Central Committee, the Politburo and the Politburo Standing Committee, the highest power in China.
The ANP will thus cover the posts of State bodies in accordance with the new hierarchical formation of the PCC.
Li Chunlin noted that the job creation target for this year is 12 million, up from last year’s target of 11 million.
Chairman of the China Development and Reform Commission Zhao Chenxin said the priority is to “unleash the potential of consumption” and promote an “innovation-driven development strategy.”
The PCC advocates an economic model based on internal consumption, to the detriment of exports, and the construction of large public works.
Beijing has moved forward with industrial plans, encapsulated in the Made in China 2025 initiative, which aims to transform the country into a technology powerhouse, with capabilities in high-value-added sectors, including artificial intelligence, renewable energy, robotics and electric cars.
Li warned that the global environment “has become more complex and difficult”, referring to the fall in demand, given the increase in interest rates in Europe and the United States, which aim to curb galloping inflation, and the deterioration of Beijing’s relations with Washington and other major trading partners.
This has increased pressure on China’s export industries that support millions of jobs, making it more urgent to boost domestic consumption.
“Consumption capacity comes from employment and income,” and therefore the government should “increase the income of urban and rural residents,” Li said.
The official did not provide further details, but the CCP has, in recent years, been pressuring the country’s big tech firms and other private sector companies to share more wealth with the public, through wage increases and philanthropy.
The economic growth target for this year is the lowest in decades, except for 2020, when economic activity was shaken by Covid-19 prevention and control measures in the first quarter of the year.
“We view this as a relatively conservative but pragmatic proposition for generating a healthy and organic economic recovery,” analysts at Japanese investment bank Nomura said in a report.
“China’s economy is still expected to face several headwinds throughout the year,” they note. “Job creation will probably be the focus of work for this year.”
Source: TSF
