BEIJING – China has set an annual gross domestic product (GDP) target of over 6 per cent for this year despite continuing global uncertainties caused by the Covid-19 outbreak.

In presenting his yearly work report on Friday (March 5) at the opening of the country’s top annual legislative meeting, Premier Li Keqiang said the target takes into account the country’s economic recovery.

China’s GDP grew by 2.3 per cent last year despite the devastating effects of the pandemic, making it the only major economy in the world to post a positive expansion.

“A target of over 6 per cent will enable all of us to devote full energy to promoting reform, innovation and high-quality development,” said the premier.

Last year, China did not set a GDP target for the first time since 1990 after the coronavirus outbreak upended the economy.

In 2019, the government set a GDP target of between 6 and 6.5 per cent, and came within range at 6.1 per cent.

Economists expect China’s economy to grow between 7 per cent and 9 per cent this year, as the world’s No. 2 economy embarks on an aggressive drive to develop technological self-reliance – especially in semiconductor chips, artificial intelligence and next-generation telecommunications – and boost domestic consumption.

The Biden administration has indicated that it intends to work with allies to restrict certain technology from being sold to China.

Other targets for this year include creating over 11 million new urban jobs, and a surveyed urban unemployment rate of around 5.5 per cent. Last year, it targeted 9 million new urban jobs but added 11.86 million jobs, while urban unemployment was 5.2 per cent, said Mr Li.

The target for consumer price index (CPI) growth for the year is around 3 per cent.

It has also set a budget deficit goal of 3.2 per cent of GDP this year, lower than last year’s 3.6 per cent.

Beijing is also likely to court an average yearly economic growth of 5 per cent over the next 15 years to hit the target of doubling its GDP by 2035 from now, said Dr Yue Su, principal economist at The Economist Intelligence Unit.

“It will be challenging, however, to achieve this given the constraints in population structure and debt burden. The absence of breakthroughs in market reform is another challenge,” she said.

Two major roadmaps, the 14th Five-Year Plan and Long-Range Objectives through the Year 2035 which chart a course for its economic trajectory and environmental targets until 2025 and 2035, were also submitted to parliament for approval.

China is forecast to surpass the US to become the world’s largest economy by 2028, five years earlier than previous projections as the two economies diverge over their post-Covid-19 recovery.

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