China has set a bold economic growth target of approximately 5% for 2024, aiming to overhaul its economic model amidst a variety of challenges.
This announcement was made by Premier Li Qiang at the opening of the annual week-long National People’s Congress (NPC) in Beijing on Tuesday. It was Li’s first report to China’s rubber-stamp legislature, attended by about 3,000 delegates.
“Stability is of overall importance, as it is the basis for everything we do,” Li said in his address. “In particular, we must push ahead with transforming the growth model, making structural adjustments, improving quality, and enhancing performance.”
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Despite these ambitious goals, no significant stimulus measures were announced, leading to a drop in Hong Kong’s Hang Seng Index. China continues to grapple with issues such as a struggling real estate sector, deflationary trends, foreign investment withdrawal, a declining stock market, and a record-low birthrate.
“In setting the growth rate at around 5%, we have taken into account the need to boost employment and incomes and prevent and defuse risks,” he added, admitting that achieving the target for this year “will not be easy.”
This goal mirrors the previous year’s target, which was the lowest in decades. They managed to surpass it slightly with a 5.2% growth rate in 2023, but many international analysts are wary of China’s reported figures due to the country’s limited data transparency. In August, China stopped publishing its youth unemployment rate after it was estimated to potentially be as high as 46.5% the month before.
China also announced plans to increase its military budget by 7.2% to 1.67 trillion yuan. This figure maintains the same growth rate as the previous year — which could signal a cautious approach to defense spending in light of economic considerations. It also continues to outpace the country’s target economic growth, as it has for years.
China’s strategy also includes a significant increase in its science and technology budget, aiming for self-reliance amid tighter US export controls on advanced technologies.
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