“China sets modest 5% economic growth target for 2023 amidst government revamp and COVID-19 aftermath”

China Sets Modest Growth Target as Economic Risks Persist

Beijing, China – Chinese officials have announced a modest economic growth target of around 5% for the year, slightly lower than analysts’ expectations, signaling the government’s cautious approach to the recovery of the world’s second-largest economy.

The target was announced during the opening of the National People’s Congress, the country’s top legislative body. The announcement comes as China aims to bounce back after years of zero-Covid policy, which severely impacted the country’s economic growth and forced businesses to shut down.

The target is also lower compared to the government’s previous targets, which were set at 6% or higher. The move reflects the government’s recognition of the challenges posed by the pandemic and the uncertain global economic environment.

“The target takes into account the domestic and international situation, and the need to balance between stability and progress,” Premier Li Keqiang said in his work report.

The Chinese economy is expected to enter a phase of “dual circulation,” with domestic demand becoming the main driver of growth, while external demand remains weak due to the pandemic. The government aims to promote innovation and technology to drive growth, while continuing to support traditional industries.

The target was met with mixed reactions, with some analysts questioning whether 5% is achievable given the challenges posed by the pandemic and the global economic environment.

“The target is achievable, but it will require significant effort and measures to stimulate growth, such as increasing investment, boosting consumption, and promoting innovation,” said Lu Ting, chief economist at Nomura.

The government is expected to roll out a package of measures to support economic growth, including increasing infrastructure investment, tax breaks, and expanding credit to small and medium-sized enterprises.

Despite the challenges, the Chinese government is confident in the country’s economic prospects, with officials emphasizing that China remains on track to achieve its goal of becoming a moderately prosperous society by 2035.