March 6 (Reuters) – Chinese Premier Li Qiang announced an ambitious 2024 economic growth target of around 5% on Tuesday, promising steps to transform the country’s development model and defuse risks fuelled by bankrupt property developers and indebted cities.
Delivering his maiden work report at the annual meeting of the National People’s Congress, China’s rubber-stamp parliament, Li also flagged higher defence spending, while hardening the rhetoric on Taiwan.
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In setting a growth target similar to last year, which will be harder to reach as a post-COVID recovery is losing steam, Beijing signals it is prioritising growth over any reforms even as Li pledged bold new policies, analysts said.
“It’s more difficult to achieve 5% this year than last year because the base number has become higher, indicating that the top leaders are committed to supporting economic growth,” said Tao Chuan, chief macro analyst at Soochow Securities.
Last year’s uneven growth laid bare China’s deep structural imbalances, from weak household consumption to increasingly lower returns on investment, prompting calls for a new growth model.
China started the year with a stock market rout and deflation at levels unseen since the global financial crisis of 2008–09. The property crisis and local government debt woes persisted, increasing pressure on China’s leaders to come up with new economic policies.
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