China sets ambitious growth target amid push to boost confidence

China sets ambitious growth target amid push to boost confidence

China will set its growth target at around 5% for the year, according to a copy of the government’s annual work report seen by Bloomberg News, raising expectations for officials to unleash more stimulus as they try to lift confidence in a slowing economy.

Premier Li Qiang is set to officially unveil the annual goal for gross domestic product while delivering his first work report to the national parliament, which kicks off Tuesday. Matching last year’s figure will be harder as 2024 lacks the favorable comparison with the pandemic’s low base that boosted previous numbers.

Almost all of the 27 economists polled by Bloomberg before the National People’s Congress expected Beijing to announce a growth target similar to last year. Economists polled in a separate, broader survey, however, said the economy would likely grow at about 4.6% in 2024.

“It’s what the Communist Party thinks is needed to keep the Chinese economy going and account for needs like employment,” Chong Ja Ian, an associate professor of political science at the National University of Singapore, said of the GDP goal for 2024.

The extent to which that growth is reached or spread across the entire economy is increasingly difficult to ascertain independently given greater restrictions on data accessibility, he added. China abruptly scrapped a three-decade tradition for the premier to hold a press conference at the NPC, fanning fears about opaque policymaking.

The government is also targeting unemployment of around 5.5% this year, and aims to add 12 million urban jobs, according to the report. China’s budget deficit is projected at 3% of GDP for 2024, while Beijing also plans to boost defense spending by 7.2%.

The meeting of the NPC comes as top leaders try to restore faith in an economy grappling with a post-pandemic slowdown. Despite that, China’s No. 2 official has signaled authorities won’t rely on massive stimulus to spur expansion as they try to break the country’s reliance on debt-driven growth.

Li’s report delivered to thousands of delegates at the Great Hall of the People in Beijing will also provide clues on authorities’ specific plans for fiscal and monetary stimulus, which could impact global commodity prices and inflation.