BEIJING (AP) — China has signaled continuity rather than change for its economy, setting a slightly lower target for growth this year in the midst of a property slump and other headwinds at home and growing uncertainty abroad.
Premier Li Qiang announced the target of 4.5% to 5% annual growth in his report presented to the opening session of this year’s meeting of the National People’s Congress. That compares to actual 5% growth last year and a target of about 5% in the three years before. It's the lowest growth target since 1991.
“While recognizing our achievements, we are also clear-eyed about the difficulties and challenges we face,” Li said, reading much of the 35-page report in a more than hourlong address.
The government is striving to balance two goals: reviving the flagging economy by boosting domestic spending while also furthering top leader Xi Jinping’s ambitions to build China into a global power in AI, robotics and other advanced technologies — and one that is not dependent on the U.S. or others for high-end semiconductors and other components.
In line with the government’s approach in recent years, the annual report Thursday indicated it would continue to support domestic demand but not unleash any major new stimulus to boost growth. “Beijing continues to prioritize strengthening industrial self-reliance over boosting household consumption,” said Neil Thomas, a China politics expert at the Asia Society Policy Institute.
China faces “a grave and complex landscape”
In its draft budget for 2026, the government also trimmed China's annual increase in defense spending to 7%, down from 7.2% in recent years. The nearly 3,000-member Congress, a largely ceremonial body that endorses policies set by Communist Party leaders, is due to approve the annual report and budget at its closing session next week, along with a five-year plan setting policy priorities until 2030.
China is grappling with tariff wars and actual wars. Like much of Asia, it depends heavily on oil and natural gas from the Middle East, and the war in that region has driven up prices and threatened supplies.
The report said that free trade is under severe threat, noting rising geopolitical risks. At home, it highlighted an “acute” imbalance between strong manufacturing supply and weak demand and the challenge of shifting to new drivers of growth.
“Rarely in many years have we encountered such a grave and complex landscape, where external shocks and challenges were intertwined with numerous domestic difficulties and tough choices,” Li said in his report.
Source: WPLG
