China Confident in Meeting 5% GDP Growth Target

China remains optimistic about meeting its annual GDP growth target of approximately 5% despite facing several economic challenges, according to Zhao Chenxin, deputy head of the National Development and Reform Commission (NDRC). In a news conference on Thursday, Zhao highlighted the country’s ability to address economic issues and maintain growth through robust policy measures and countercyclical adjustments.

Zhao acknowledged that the broader economy is under pressure from various negative external factors, insufficient domestic demand, and persistent risks in key sectors. Nevertheless, he emphasized that favorable conditions and positive economic factors are expected to support a recovery in the latter half of the year. “We still have plenty of room to step up countercyclical policy adjustment,” Zhao stated, pointing to the gradual effects of recent stimulus measures as a foundation for economic recovery.

China Confident in Meeting 5% GDP Growth Target Despite Economic Pressures

Recent economic data presents a mixed picture. The Caixin China General Manufacturing Purchasing Managers’ Index (PMI) fell to 49.8 in July, down from 51.8 in June, while the official PMI from the National Bureau of Statistics reported a slight decrease to 49.4 in July from 49.5 in June. Both indices remain below the 50-point threshold that indicates economic expansion.

Despite these figures, Caixin reported improved sentiment among manufacturers, with increased confidence about future business developments and new product launches. Wang Zhe, senior economist at Caixin Insight Group, identified insufficient domestic demand and weak market optimism as significant issues. He called for focused policy efforts to stabilize growth, boost employment, and enhance market vitality.

Experts suggest that upcoming key meetings may lead to new incremental policies that will bolster market confidence and drive a steady recovery. Guo Chunli, director of the Economic Research Institute at the Chinese Academy of Macroeconomic Research, emphasized that macroeconomic policies, ongoing reforms, and innovation-driven development will further strengthen domestic driving forces and competitive advantages.

A State Council executive meeting on Wednesday stressed the importance of optimizing macroeconomic policies and implementing existing measures more effectively, with potential new policies on the horizon. Additionally, a recent Political Bureau meeting of the Communist Party of China Central Committee committed to enhancing macroeconomic support, focusing on expanding domestic demand and encouraging sectoral development to achieve the annual growth target for 2024.

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