The Chinese government hopes to achieve GDP growth of around 5% this year, but the post-pandemic recovery has been slow. Authorities have announced stimulus measures, but have come under fire.
Chinese Prime Minister Li Qiang stated this Tuesday that He is fully confident in his country’s ability to achieve its 2024 economic goals and suggests new stimulus measures.
The Government hopes to achieve GDP growth of around 5% this year. But the post-pandemic recovery has been slow, with China posting its weakest quarterly growth in a year and a half in the period from July to September.
Authorities announced measures to stimulate activity, including interest rate cuts and easing restrictions on home purchases. However, many analysts criticized the fact that there is still no large-scale stimulus plan.
This announcement can be made this week, following a meeting of the Standing Committee of the National People’s Congress, China’s highest legislative body (in fact, subordinate to the Chinese Communist Party (CCP).
“We have full confidence that this year’s targets will be achieved and the Chinese economy will grow in the near future,” said Li Qiang in Shanghai.
Li, officially responsible for economic policy as prime minister, spoke at the opening ceremony of the China International Import Fair (CIIE), a major annual trade event involving hundreds of foreign companies.
He suggested that authorities still have room to maneuver to adopt new measures.
“We face downward pressure on the economy, but there is still room for fiscal and monetary measures,” he said.
After a strong rise in the stock market a few weeks ago, fueled by the hope of an important stimulus plan, optimism has diminished in the face of policies that the markets do not consider strong enough.
However, there have been some positive signs recently. Factory activity rose last month for the first time since April, according to official data released last week.
In the services sector, activity also accelerated in October, according to an independent index published today by S&P Global and Caixin magazine.
Li Qiang said: “Recently, China’s major economic indicators have recovered globally, market confidence has increased significantly (…) and there have been many positive changes in the economy.”
But the Chinese economy faces a serious obstacle: growing trade tensions with some of its closest trading partners, led by the European Union (EU) and the United States.
Before an audience of foreign dignitaries, including the prime ministers of Malaysia, Slovakia and Serbia, gathered at the China International Import Fair (CIIE), Li Qiang assured that China is more open to investment.
However, he warned of the rise of unilateralism and protectionism.
“From a global point of view (…) many problems arose that should not have arisen,” he highlighted.
“In particular, all types of dishonest behavior, which had a destructive effect on the rules,” he highlighted.
China is particularly angry about punitive tariffs imposed by the EU and the United States on electric vehicles made in the Asian country.
In response, Beijing threatens to increase taxes on spirits from Europe. Since mid-October, it has required importers to deposit a deposit with Chinese customs.
China also launched investigations antidumping on pork and dairy products imported from Europe, threatening these sectors.
Source: Observadora
