In an extraordinary move that has sent tongues wagging,, China has cut its annual economic growth target to a range of 4.5%-5%, the lowest expansion goal since 1991 as it grapples with challenges both at home and abroad.
It is about the first time the target has been lowered since it was cut to “around 5%” in 2023. A target was not set in 2020 due to the pandemic.
The details were released during China’s biggest political gathering, known as the “two sessions”, alongside the release of some details of the 15th Five Year Plan for the world’s second largest economy.
Beijing aims to reshape its economy as it faces issues like weak consumption, a shrinking population, an ongoing property crisis, global trade tensions and an energy crunch due to the Iran war.
One China analyst told the BBC that the lower target gives China “more room to manage the economy” without being forced into making huge financial commitments just to hit a precise goal.
“China has used flexible targets before, particularly during the pandemic, but it’s not the norm,” Jason Bedford from the East Asian Institute research group added.
The two sessions event, which began on Wednesday and usually runs for at least a week, brings the country’s leaders together for back-to-back meetings.
Details of China’s gross domestic growth (GDP) target and its objectives under its latest Five Year Plan were included in a 46-page report published by Premier Li Qiang, seen by the BBC.
The full text of the plan, which will outline China’s economic development objectives to 2030, will be voted on during the closing day of the gathering.
It is expected to be released by state media one or two days later.
Li informed delegates that the Five Year Plan will include investments in innovation, high-tech industries, scientific research and more efforts to boost household consumption.
His comments reveal Beijing’s concerns that weak domestic consumption makes the country too reliant on exports, as well as highlighting its ambitions to upgrade the country’s manufacturing industries.
