China’s economy is forecast to grow more than 5% this year.
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BEIJING – China has set a growth target of “about 5%” for 2023, according to Premier Li Keqiang’s government work report released on Sunday.
Analysts generally expect China to set a GDP target above 5% for 2023. The median growth forecast is 5.24%, according to a CNBC analysis.
China also targets a consumer price index of 3% and the unemployment rate of people in cities at 5.5% — with the creation of about 12 million new urban jobs. That’s more than last year’s “more than 11 million” target.
The work report calls for a “conservative monetary policy” in a “targeted manner”. The report said the deficit-to-GDP ratio is expected to increase to 3% from 2.8% last year.
Li presented the report on Sunday at the opening ceremony of the National People’s Congress, part of the annual “Two Sessions” parliamentary meeting. This was his last congress as prime minister.
The work report notes the coming change in central government leadership, and outlines eight priorities for economic policy.
According to the report, boosting domestic demand – from consumption and investment – ranked first, followed by improving the industrial system and supporting non-state enterprises.
Other priorities include “increasing efforts to attracting and using foreign investment capital” “preventing and alleviating” financial risks, stabilizing grain production, continuing green development and developing social programs.
“We should strive to develop the digital economy, strengthen regular monitoring and support the development of the platform economy,” the report said in English.
Although it did not name specific companies, internet technology companies like Alibaba are often part of the “platform economy”, which has come under increasing scrutiny by Beijing over the past few years.
Real Estate
On real estate, the work report calls for supporting residents to buy their first homes and “help solve the housing problems of new urban dwellers and young people.”
“We need to ensure effective hedging and risk reduction for top-quality, top-quality real estate businesses, helping them improve debt-to-asset ratios and prevent uncontrolled expansion of real estate. real estate market to promote the stable development of the real estate sector,” the report stated. the report said.
The slowdown in the large-scale real estate sector hit China’s economic growth last year. Beijing has cracked down on developers’ heavy reliance on debt for growth in 2020.
Bruce Pang, chief economist and head of Mainland China research at JLL, said China’s property policy is likely to support the sound financial needs of quality real estate companies. high quality and direct them to areas of sustainable growth.
On the other hand, developers who “can’t proactively complete business adjustments and transformations will be naturally rejected by the market,” he said in Mandarin, as translated by CNBC.
China’s GDP grew by just 3% last year in a rare miss of the national target.
The country has set a growth target of around 5.5% for 2022. But Covid controls, including the two-month blockade of Shanghai and a slump in real estate, has dragged growth down.
This year, Two sessions are also set up to formalize government titles for the new Prime Minister, Deputy Prime Ministers and heads of different ministries. This year’s National People’s Congress will end on March 13.
Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, said: “With the government completely reshuffled, an important issue to watch over the next few months is that new leaders will push ahead. How is the confidence of the private sector”. “This is more important than monetary and fiscal policies, in my view.”
