China eyes stable growth with an ‘around 5.5%’ GDP target in 2022, projects confidence amid rising challenges
Chinese Premier Li Keqiang on Saturday delivered the annual Government Work Report to the opening meeting of the fifth session of the 13th National People’s Congress (NPC), China’s top legislature, which set an expectations-beating GDP growth target of around 5.5 percent in 2022, projecting policymakers’ confidence in the resilience of the world’s second-largest economy even as they warned of “many more risks and challenges” this year.
In what many describe as a “warm and powerful” message, this year’s Government Work Report also outlined policy priorities for a wide range of areas of social and economic development, including epidemic control, jobs creation, environmental protection and crackdown on trafficking of women and children – all key issues related to the lives and livelihood of 1.4 billion Chinese.
In the roughly one-hour, 16,000-word Government Work Report, Li warned of various risks and challenges this year, but also highlighted China‘s resilience and confidence.
“We must be more mindful of potential difficulties, face problems and challenges squarely, make every effort to deliver a satisfactory performance, and do our utmost to live up to people’s expectations,” Li told NPC deputies and members of the Chinese People’s Political Consultative Conference (CPPCC) National Committee, the top political advisory body, at the Great Hall of the People in Beijing.
“It has always been in the course of meeting challenges that China has advanced its development. We the Chinese people have the courage, vision and strength to overcome any obstacle or difficulty,” Li said.
The NPC session and the annual meeting of the CPPCC National Committee are collectively known as the two sessions. It’s one of the most important political events in the country each year that offers a window into China’s policy priorities for the year.
Among the closely-watched issues at the two session is the official GDP growth target. Observers noted that the growth target of around 5.5 percent, although below last year’s 8.1 percent, will still likely outpace growth in many other major economies and play a key role in the global recovery amid a lingering pandemic, the Ukraine situation and mounting domestic pressure.
China’s GDP hit 114.4 trillion yuan ($18.11 trillion) in 2021 and a 5.5 percent expansion on this basis this year equals a 7.4 percent growth 5 years ago or a 10.5 percent growth 10 years ago, Xiang Dong, deputy director of the State Council Research Office, said at a press conference in Beijing on Saturday afternoon that expounded on the Government Work Report.
That also suggests an economic increment of nearly 9 trillion yuan, tantamount to the full-year size of the world’s No.11 or No.12 economy, Xiang said, noting achieving the 5.5 percent growth target is by no means an easy job and would necessitate an arduous endeavor.
Observers said the target reflects that top policymakers are fully aware of the difficulties faced by the Chinese economy. “This year our country will encounter many more risks and challenges, and we must keep pushing to overcome them,” the report reads.
Stability, a key word in this year’s Government Work Report, was mentioned 76 times, and all regions and government departments are required to take responsibility for stabilizing the economy and proactively unveil measures that support economic stabilization, Xiang said.
All various factors have been taken into full account while drafting the Government Work Report, Xiang, also a member of the Government Work Report drafting team, told the Saturday press conference, in response to a question about the impact on China’s economic growth target of the Russia-Ukraine conflict.
A growth target of around 5.5 percent takes full account of macroeconomic operations and the economy’s long-term development goals, Zhixin Investment Research Institute said in a note, describing the around 5.5 percent target as reasonable and indicative of the government’s calibration of putting the economy back on the pre-COVID track for slower yet steady growth.
Put in perspective: the annual growth rate was set at 6-6.5 percent for 2019 as the economy pursued higher-quality growth. An expansion of 8.1 percent in 2021 was considered to be based on a low base in the coronavirus-hit 2020.
China has the condition, capability and confidence to achieve the 5.5 percent GDP growth target despite multiple challenges and uncertainties, He Lifeng, head of China’s top economic planner, told reporters on Saturday on the sidelines of the two sessions.
“The impact does exist, but as a major economy, China has a huge economic size and many policy tools. Government measures are effective and policies are flexible. Even if there are shocks, we can maintain independent macroeconomic policies,” Yu Yongding, former president of the China Society of World Economics and director of the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, told the Global Times.
The Government Work Report also set a slew of economic and social development goals for 2022, including creating more than 11 million new urban jobs and keeping CPI growth at around 3 percent. Another keenly watched data is China’s deficit-to-GDP ratio, which was set at around 2.8 percent for 2022, down from 3.2 percent last year.
“The Government Work Report, seeking truth and being pragmatic, inspires the people to forge ahead and is full of average folks’ deep expectations,” Yao Jinbo, an NPC deputy and CEO of Chinese classifieds site 58.com, told the Global Times on Saturday.
Yao said the pursuit of stability while making progress will be the guiding principle for this year’s work. The annual report, as Yao puts it, signals a people-centered development mindset.
Among the annual report’s key takeaways for this year’s major tasks are also efforts to advance social governance and improve people’s wellbeing.
China will crack down hard on the trafficking of women and children and protect their lawful rights and interests, the premier said while delivering the Government Work Report. The issue has garnered national attention following a recent case in Xuzhou, East China’s Jiangsu Province.
The system for supporting and caring for senior citizens and people with disabilities will also be improved, the Government Work Report said. Moreover, the country will improve the supporting measures for the three-child policy, make expenses for caring for children under three part of the special additional deductions for individual income tax, and develop public-interest childcare services to ease the burden of raising a family, per the annual report.
“Warm and powerful,” Huo Tao, an NPC deputy and chairman of Baiyunshan Technology Company, said after hearing the Government Work Report, which shows the country’s achievements, points out the problems, maps out a blueprint, demonstrates the courage to face up to challenges, and conveys the confidence that unity will prevail.
According to Huo, the NPC deputy who has listened to the annual report five times, what impressed him the most this year is the repeated mention of the implementation of policies that respond to people’s concerns, such as support for small and medium-sized enterprises, scientific and technological innovation, and tax and fee cuts.
Jiang Haoran, a member of the CPPCC National Committee, said he felt “calmness in the face of a crisis” and the confidence of the country. “In the face of the achievements we have made, we have always been mindful of dangers in times of peace. As risks and challenges have increased significantly, we must surmount obstacles and the more difficulties we face, the more confident and committed we must be.”
Focus on innovation
The digital economy is envisioned to play a better role in powering up the economy.
“We will strengthen overall planning for the Digital China initiative, build more digital information infrastructure, and apply 5G technology on a larger scale,” read Saturday’s work report, highlighting moves to build up digital industries such as integrated circuits and artificial intelligence, and enhance China’s technological innovation and supply capacities for key software and hardware.
Xiao Hong, CEO of Chinese gaming giant Perfect World, who was heartened by the Government Work Report to resolutely make commitments to the digital economy, said the digital economy provides a strong impetus to the economy and society’s sustainable and healthy development.
Green and sustainable development is a long-standing goal of China and was also a top priority on the Government Work Report, which vowed to improve the environment and promoting green and low-carbon development, despite mounting risks and challenges.
Source: Global Times