China has lowered its economic growth forecast to “about 7 percent” in 2015 at the opening of its annual meeting of parliament, the National People’s Congress — the nation’s biggest yearly political event — which started on Thursday and generally lasts about 10 days.
Chinese Premier Li Keqiang said on Thursday that China will set its official 2015 economic growth target, or gross domestic product (GDP), at “about 7 percent”, China’s state-run Xinhua news agency reports.
China’s GDP target of 7 percent for 2015 is the lowest growth target in over 15 years, according to Bloomberg.
In 2014, China’s economic growth expanded by 7.4 percent, its slowest rate in 24 years and was the first time since 1998 that its growth rate fell short of the government’s official target.
As China adjusts to a “new normal” of slower but more sustainable growth, a 7 percent economic growth target will be set as a floor, or the minimum growth that the nation needs in order to fend off deflation and to keep employment strong enough so that it can push on with key reforms.
On Wednesday, China’s Central Bank, The People’s Bank of China (PBOC), cut the interest rates at its short-term lending facility (SLF) for its local branches. Overnight lending rates were cut to 4.5 percent from 5 percent and seven-day lending rates were be cut to 5.5 percent from 7 percent.
In February, India revised the way that it calculates its gross domestic product (GDP), and now – based on the new calculated data – the nation’s economic growth now surpasses the traditional Asian powerhouse of China.
In addition to China’s lower GDP target for 2015, there were a number of 2015 estimates, alongside a raft of proposals that were announced on Thursday in an effort to support the nation’s economy:
*Premier Li says 2015 GDP growth target around 7 percent
*Premier Li says 2015 2015 CPI target around 3 percent
*Premier Li says sees 2015 budget deficit at 2.3 percent of GDP
*China’s National Development and Reform Commission (NDRC) says to target total trade growth of around 6 percent in 2015
*Premier Li says 2015 M2 growth target at around 12 percent
*Premier Li says will set up deposit insurance system
*Premier Li says to keep renminbi at appropriate and balanced level
*Premier Li says to float yuan more freely
*NDRC says China targets 2015 fixed asset investment growth of 15 percent
*Premier Li says China to push forward yuan convertibility on capital account
*NDRC says China targets 2015 retail sales growth of 13 percent
*Premier Li says China to quicken cross-border yuan payment system
*Premier Li says aims to create over 10 million new jobs in 2015
*Premier Li says will launch Shenzhen-Hong Kong Stock Exchange connect pilot at appropriate time
*Premier Li says will keep economic growth within reasonable range
*Premier Li says will deepen reforms of state-owned enterprises
*Finance Minister says China budgets 2015 national fiscal deficit of 1.62 trillion yuan
*Premier Li says will push fiscal, price reforms
*Premier Li says will increase international market share for Chinese railways, electric power, communications, aircraft
*Premier Li says will broaden use of forex reserves
*Finance Minister says China budgets 2015 national fiscal revenue up 7.3 percent
*Finance Minister says China budgets 2015 national fiscal spending up 10.6 percent
*Premier Li says will allow more domestic private banks to be set up
*Premier Li says will forward interest rate reforms
*Finance Minister says will continue with active fiscal policy in 2015 and appropriately step it up
*Premier Li says to build additional 7.4 million units of public homes in 2015
*Finance Minister says to enhance management of local government debt
*Premier Li says will boost domestic consumption
*Premier Li says modernizing agriculture is key to reform
*Premier Li says will stabilize housing consumption
*Finance Minister says will strictly control fiscal risks
*Premier Li says will invest 1.6 trillion yuan in railways, water
*NDRC says will reduce taxes across the board
*Premier Li says will ensure unemployment rates does not exceed 4.5 percent in 2015
*NDRC says will expand pilot for replacing business tax with value added tax
*NDRC says will keep monetary policy not too loose or too tight
*Premier Li says will improve local government debt-raising mechanism
*Premier Li says will cut current energy intensity by 3.1 percent
*Premier Li says will increase imports and exports by 6 percent
*Premier Li says will halve the number of industries in which foreign investment is restricted
*NDRC says expects 2015 retail sales to grow by 13 percent
*NDRC says will raise pension benefits for retirees by 10 percent
*NDRC says will encourage more mergers, shut outdated capacity in oversupplied sectors
*NDRC says will roll out guidelines for intergration of Beijing-Tianjin-Hebei region
*Premier Li says downward pressure on the economy is intensifying
*Premier Li says economy faces greater difficulties in 2015, versus 2014
*Premier Li says will aim for zero growth for consumption of coal in key parts of China
*Premier Li says will expand trial project for electricity pricing and transmission reform
*NDRC says will replace coal usage with alternative energy sources in heavily polluted areas
*Premier Li says in principle to lift pricing controls for all goods and services that are competitive