Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

China decides not to set a GDP target for 2020 as coronavirus batters the economy

China decides not to set a GDP target for 2020 as coronavirus batters the economy

Chinese Premier Li Keqiang shared the government’s outlook Friday as part of China’s annual parliamentary meeting, delayed by about two months this year due to the coronavirus. Last year, GDP expanded by 6.1%, just making the official target range of 6% to 6.5%.

China made a rare decision not to set a target for its economic growth for 2020 due to uncertainties about the impact of the coronavirus.

“I would like to point out that we have not set a specific target for economic growth this year,” Chinese Premier Li Keqiang said in an English-language text of the work report delivered on Friday.

“This is because our country will face some factors that are difficult to predict in its development due to the great uncertainty regarding the Covid-19 pandemic and the world economic and trade environment,” Li said.

The remarks are part of China’s annual parliamentary meeting, which was delayed by about two months this year due to the coronavirus outbreak that began in China last year and has since spread globally.

As a result, some analysts expected ahead of the report that Li might share a GDP target for a timeframe other than 2020 itself. Last year, GDP expanded by 6.1%, just making the official target range of 6% to 6.5%.

“The fact that they dropped the GDP growth target is a good thing if it means that they really intend to let sustainable demand - consumption, exports, and private sector investment - drive growth,” Michael Pettis, professor of finance at Peking University, said Friday in an email.

“If they have only dropped it temporarily while they try to figure the full impact of the pandemic, and later select an implicit target that relies heavily on non-productive spending on infrastructure and real estate, then this really doesn’t change anything,” Pettis said.

China’s economy contracted by 6.8% in the first quarter, while unemployment has stayed near historic highs. Although data have shown some recovery in April, officials have publicly aired concerns about a drag on growth from the coronavirus’ spread overseas.

Economists have cut their growth forecasts for the official GDP - a figure that many economists often doubt. In late March, Beijing-based China International Capital Corporation (CICC) notably lowered its real GDP growth estimate to 2.6%, down from 6.1% previously.


Employment remains top priority


While China did not set a GDP target for the year, authorities still laid out some specific numbers for items such as employment and inflation.

Li stressed that ensuring people have jobs will remain a priority, as it was last year. Beijing will target an unemployment rate of 6%, as measured by the official urban survey, Li said.

That’s up from last year’s goal of 5.5%. The number of new jobs promised, “over 9 million,” was fewer than the 11 million targeted last year.

The consumer price index target was set at around 3.5%.

Covid-19 emerged in the Chinese city of Wuhan late last year and has killed more than 4,600 people in the country. The outbreak has since become a global pandemic, infecting more than 5 million people and killing more than 330,000 people worldwide.

The world’s second-largest economy has been the first to impose — and emerge from — government lockdowns on businesses and social gatherings. The outbreak stalled domestically by early March, and by the end of April, most businesses that survived the lockdown had resumed work, although not necessarily at the same level of operations prior to the pandemic.


China to issue more debt


During Friday’s opening ceremony of the NPC, Li laid out a plan for moderate increase in government support for the economy.

He also said the fiscal deficit will increase from last year by 1 trillion yuan ($142.86 billion), for a deficit-to-GDP ratio of more than 3.6%.

“On top of this, one trillion yuan of government bonds for Covid-19 control will also be issued,” Li said, calling them “extraordinary measures for an unusual time.”

Special local government bonds for project development will also increase by 1.6 trillion yuan over last year, for a total issuance of 3.75 trillion yuan, Li said.

China will step up construction of new types of infrastructure that will help expand the reach of 5G and electric car charging facilities, Li said. The country will also boost efforts for water conservancy, and increase national railway development capital by 100 billion yuan.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Severe Heatwave Claims 2,300 Lives Across Europe
Declining Beer Consumption Signals Cultural Shift in Germany
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
Western Europe Records Hottest June on Record
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
China’s Central Bank Consults European Peers on Low-Rate Strategies
France Requests Airlines to Cut Flights at Paris Airports Amid Planned Air Traffic Controller Strike
Poland Implements Border Checks Amid Growing Migration Tensions
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Massive Anti-Government Protests Erupt in Belgrade
Iran Executes Alleged Israeli Spies and Arrests Hundreds Amid Post-War Crackdown
Hungary's Prime Minister Criticizes NATO's Role in Ukraine
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Hungarian Scientist to Conduct 30 Research Experiments on the International Space Station
NATO Members Agree to 5% Defense Spending Target by 2035
NATO Leaders Endorse Plan for Increased Defence Spending
U.S. Crude Oil Prices Drop Below $65 Amid Market Volatility
International Astronaut Team Launched to Space Station
Macron and Merz: Europe must arm itself in an unstable world
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Iran Intensifies Crackdown on Alleged Mossad Operatives After Sabotage Claims
Trump Praises Iran’s ‘Very Weak’ Response After U.S. Strikes and Presses Israel to Pursue Peace
Oil Prices Set to Surge After US Strikes Iran
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
Labubu Doll Drives Pop Mart to Status as China’s Most Valuable Toy Maker
Global Coal Demand Defies Paris Accord Goals
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
×