Chinese officials said on Monday the country’s goal to achieve a GDP growth target of around 5 percent in 2023 conforms to the long-term trend of economic development and the focus on tackling risks and improving quality and efficiency, underscoring China’s focus on high-quality development.
Chinese President Xi Jinping stressed on Sunday that high-quality development is the first and foremost task in building a modern socialist country in all respects. The Government Work Report submitted to the National People’s Congress (NPC), the top legislature, on Sunday also made it clear that China will focus on organic, high-quality development rather than opening the “floodgates” of stimulus to prop up growth.
China’s pragmatic and reasonable growth target this year as well as its focus on high-quality development have helped instill confidence in businesses and inject a sense of certainty into a world full of uncertainties, Chinese national lawmakers and political advisors, economists and some foreign institutions noted.
Inspiring confidence
“The expected target of about 5 percent is in line with the trend of economic operation and the law of economic development, and it is also conducive to guiding all parties to pay more attention to improving the quality and efficiency of economic development,” Zhao Chenxin, deputy director of the National Development and Reform Commission (NDRC), China’s top economic planning agency, said at a press conference on Monday.
Officials from the National Development and Reform Commission (NDRC), China’s top economic planning agency, elaborate on China’s high-quality development at a press conference on March 6, 2023 in Beijing. Photo: VCG
In line with the tone of the Government Work Report, officials from the NDRC also stressed economic stability, vowing to strengthen economic monitoring, forecasting and early warning, enrich the policy toolbox and prepare for various tasks to deal with complex and difficult situations to promote an overall improvement in economic operations. In particular, officials put an emphasis on high-quality development, an overarching theme of economic policymaking set by China’s top leadership.
While attending a deliberation with his fellow deputies from the delegation of Jiangsu Province at the first session of the 14th NPC on Sunday, Xi said that efforts should be made to fully and faithfully apply the new development philosophy on all fronts, and better coordinate the effective upgrade in quality with the appropriate expansion in quantity in economic development, according to Xinhua.
On Monday afternoon, Xi visited national political advisors from the China National Democratic Construction Association and the All-China Federation of Industry and Commerce, urging proper guidance for the healthy and high-quality development of the private sector, according to Xinhua.
Xi said that the Communist Party of China Central Committee always maintains that the non-public sector’s status and functions in the country’s economic and social development have not changed, the principle and policies to unswervingly encourage, support and guide the development of the sector have not changed, and the principle and policies to provide a sound environment and more opportunities to the sector have not changed.
China’s growth target and focus on quality have boosted confidence among Chinese national lawmakers and political advisors, who represent voices from all walks of life.
“What impresses me the most is that the report proposes that the GDP will grow by about 5% this year, and about 12 million new urban jobs will be created, which demonstrates China’s determination to stabilize the economy,” said Zhu Dingjian, a member of the 14th National Committee of the Chinese People’s Political Consultative Conference (CPPCC) and chairman and CEO of Mission Hills Group.
“The report reflects the government’s firm confidence in the Chinese economy, and also enhances the confidence of enterprises, society and the people, which is more important than gold,” Zhu said in a statement sent to the Global Times.
After China announced its annual GDP growth target in the Government Work Report on Sunday, some foreign media outlets described it as a “modest growth target” in many years to hype risks and challenges in the world’s second-largest economy. A Bloomberg article, for example, claimed the target and regulatory reforms may “deter some investors from returning any time soon.”
Some foreign media outlets also compared China’s GDP growth last year with that of the US and raised questions about China’s prospect to surpass the US economy in the coming years. Asked about the widening gap between China and US economies, Zhao noted that the US’ nominal GDP was greatly lifted by its high inflation, while China’s development is focused on benefiting the people.
“China’s development is people-centered development and its purpose is to benefit the people… Through such development, the Chinese people can live a better life, and at the same time, let China’s development contribute more and more to world peace and development,” Zhao said.
Also, foreign media’s claims about China’s GDP growth target miss the big picture of China’s economic development, which continues to be among the fastest-growing major economies, while the quality of development is also continuously improving, Chinese national lawmakers and political advisors said.
Focusing on quality
“Behind the steady and sound economic goals is the government’s confidence in the endogenous restoration of the economy, its requirements for a modern industrial system and high-quality development, and its concern for major economic and financial risks,” economists at CITIC Securities wrote in a research note shared with the Global Times on Monday. They believe the report shows China will make monetary policies more “targeted” and tackle various risks such as those in real estate, local government debts and financial markets.
Nomura Securities, a Japan-based firm, also said China’s growth target is pragmatic and reasonable, despite being lower than market expectations.
In a note sent to the Global Times on Monday, Nomura said that the target is a pragmatic proposal for delivering a healthy and organic economic recovery, and there is no sign of a massive stimulus.
“In our view, the GDP growth target of “around 5.0 percent” is a reasonable and rational choice.”
As part of the drive for high-quality development, China will step up investment in technological innovations to achieve tech self-reliance amid risks of foreign technological blockade, industry leaders and analysts said.
Qi Xiangdong, a member of the 14th National Committee of the CPPCC and chief executive officer and chairman of Qi An Xin Technology Group, noted that self-reliance in science and technology has been stressed in the Government Work Report, which is essential for China’s long-term goals of modernization.
“Some Western developed countries have imposed blockades on China’s industrial chain, and there is a risk of supply interruption. To achieve our [goal], we must achieve self-reliance in existing technologies and self-strength in future technologies,” Qi said in a statement sent to the Global Times.
Also, Moody’s Investors Service noted that increasing investment in technological progress, digitalization and strengthening supply chains remain key policy directions aimed at cutting reliance on overseas technology and upgrading China’s manufacturing sector.
“Scientific and technological policies should aim at building up our country’s strength and self-reliance in science and technology,” read the Government Work Report. “We should better leverage the role of the government in pooling resources to make key technological breakthroughs, and enterprises should be the principal actors in innovation.”