BEIJING – China lowered its GDP target to 6.5-7 per cent this year with Premier Le Keqiang warning that the world’s second-largest economy will face tougher problems in future and must be prepared to fight a “difficult battle”.
China’s woes over a slowing economy were reflected in its growth prospects as it lowered the GDP target, acknowledging that downward pressures may affect employment scenario and personal incomes.
The economy, which grew 6.9 per cent last year, however remained within “an appropriate range,” Premier Li Keqiang said in his work report submitted to the annual session, the National People’s Congress (NPC).
“China will face more and tougher problems and challenges in its development this year, so we must be fully prepared to fight a difficult battle,” Li said.
“Downward pressure on the economy is growing,” Li said. “Domestically, problems and risks that have been building up over the years are becoming more evident.”
China grew by 67.7 trillion yuan in 2015.
In dollar terms it was about USD 10.4 trillion, marginally above the over USD 10 trillion in 2014 due to steady depreciation of the Chinese currency against US dollar.
Presenting his report before 3,000 lawmakers of the NPC, often described as a rubber-stamp parliament for its routine approval to the decisions of the ruling Communist Party of China (CPC), Li said the target for this year is set at 6.5 per cent to 7 per cent.
Chinese President Xi Jinping earlier directed officials to ensure that the GDP should not go below 6.5 per cent, amid fears that the economy may be heading for a “hard-landing.”
While Li read his report, a report on the implementation of the draft five-year plan submitted to NPC by the National Development and Reforms Commission – which is akin to India’s NITI Aayog – painted a grim picture about the consequences of the slowdown.
“The slowdown in the growth of the demand is continuing. With international demand remaining weak, the situation in relation to the foreign trade has become more challenging and complex. As downward pressure China’s economy begins to affect employment and personnel incomes, it may also spread to affect private consumption,” it said.
The local government debt was unofficially stated to be more than USD 1.8 trillion.
