China has announced an official downgrade of its economic growth target to “approximately” 7%, from 7.5% previously.
“This year’s economic growth target will be around 7 percent, but the 7 percent should be the bottom line,” a government adviser told Reuters.
Most analysts are expecting growth to slow in China this year but the official target had not been declared.
Announcing the target Chinese Premier Li said:
The target growth rate of approximately 7 per cent takes into consideration what is needed and what is possible … If China’s economy can grow at this rate for a relatively long time, we will secure a more solid material foundation for modernisation.
Embedded in the target is also an implicit promise of more easing with Reuters reporting that Premier Li also promised to create 10 million jobs and announced plans to boost consumer confidence and demand.
The latter is vital to the current plans to deepen and broaden the consumer sector. This policy is being pursued to reduce the reliance of the Chinese economy on investment and exports as its driving force in favour of domestic lead growth.