Chinese
Premier
Li
Qiang
delivers
a
speech
during
the
opening
of
the
second
session
of
the
14th
National
People’s
Congress
at
The
Great
Hall
of
People
on
March
5,
2024
in
Beijing,
China.
Lintao
Zhang
|
Getty
Images
News
|
Getty
Images
BEIJING
—
China
set
a
growth
target
of
“around
5%”
for
2024
and
announced
the
issuance
of
“ultra-long”
special
bonds
for
major
projects,
according
to
a
government
work
report
Tuesday.
Premier
Li
Qiang,
who
delivered
the
report,
also
pledged
that
China
would
remove
restrictions
for
foreign
investment
in
manufacturing.
China
set
a
deficit-to-GDP
ratio
of
3%
for
the
year,
down
from
a
rare
upward
revision
to
3.8%
late
last
year
from
the
original
3%.
The
work
report
also
said
Beijing
will
issue
1
trillion
yuan
($138.9
billion)
in
“ultra-long”
special
treasury
bonds
this
year
to
fund
major
projects
aligned
with
national
strategies,
while
3.9
trillion
yuan
of
special-purpose
bonds
for
local
governments
will
be
issued
this
year,
100
billion
yuan
more
than
last
year.
“We
should
appropriately
enhance
the
intensity
of
our
proactive
fiscal
policy
and
improve
its
quality
and
effectiveness,”
the
work
report
said.
The
on-budget
deficit
excludes
special
bonds,
policy
bank
bonds
and
local
government
financing
vehicle
debt,
according
to
Louise
Loo,
lead
economist
at
Oxford
Economics,
who
last
week
forecast
a
3%
to
3.5%
deficit.
An
IMF
report
earlier
this
year
said
its
conversations
with
Chinese
officials
indicated
they
viewed
last
year’s
fiscal
policy
as
proactive.
“The
ultra-long-term
special
treasury
bonds
issued
on
a
trial
basis
will
not
be
included
in
the
deficit,
and
can
be
issued
at
an
appropriate
time
based
on
market
and
economic
conditions
under
the
trend
of
moderately
increasing
leverage
of
the
central
government
to
ensure
flexibility,”
said
Bruce
Pang,
chief
economist
for
the
property
consultancy
JLL,
in
a
CNBC
translation
of
his
comments.
“They
may
gradually
replace
the
issuance
of
local
special
bonds
to
better
support
the
country’s
long-term
and
major
strategic
planning
and
construction
of
key
areas
and
implementation
of
large-scale
infrastructure
projects,”
he
added.
Two
Sessions
The
targets
for
GDP
and
other
economic
indicators
were
published
as
part
of
the
opening
of
the
National
People’s
Congress
annual
meeting
in
Beijing,
which
more
than
2,800
delegates
attended
Tuesday.
Last
year
China’s
economy
grew
by
5.2%,
matching
the
official
target
of
around
5%.
The
overall
rebound
from
the
pandemic
was
slower
than
many
expected,
while
growth
also
faced
drags
from
a
slump
in
real
estate
and
exports.
This
year,
China
plans
to
target
an
urban
unemployment
rate
of
around
5.5%,
the
creation
of
12
million
new
urban
jobs
and
a
consumer
price
index
increase
of
around
3%.
The
2024
targets
were
the
same
as
those
set
for
2023.
In
2023,
the
National
Bureau
of
Statistics
said
the
country
averaged
a
5.2%
unemployment
rate
in
cities
and
created
12.44
million
jobs.
However,
the
consumer
price
index
rose
by
0.2%
amid
lackluster
demand.
The
work
report
emphasized
the
need
to
“ensure
both
high-quality
development
and
greater
security,”
preventing
risks
and
maintaining
social
stability,
among
other
tasks.
It
called
for
implementing
the
decisions
and
plans
of
the
Communist
Party
of
China’s
Central
Committee.
China’s
economic
policies
for
the
year
ahead
are
typically
discussed
by
top
party
leaders
in
December.
Local
governments
hold
their
own
meetings
to
set
regional
growth
targets,
before
the
National
People’s
Congress
announces
the
goal
for
the
entire
country.
Beijing
in
recent
years
has
downplayed
the
number
in
favor
of
what
it
calls
“high-quality”
growth.
Diffusing
risks
The
work
report
said
that
“internal
drivers
of
development
are
being
built
up,”
but
added
the
country
should
be
“well
prepared
for
all
risks
and
challenges.”
China
pledged
to
improve
the
long-term
mechanisms
for
preventing
and
controlling
risks.
“We
will
implement
a
package
of
measures
to
defuse
risks
caused
by
existing
debts
and
guard
against
risks
arising
from
new
debts,”
Beijing
said
in
the
work
report.
“We
will
take
prudent
steps
to
defuse
risks
in
small
and
medium
financial
institutions
in
some
localities
and
take
tough
measures
against
illegal
financial
activities.”
China
also
pledged
to
“meet
justified
financing
demands
of
real
estate
enterprises
under
various
forms
of
ownership
on
an
equal
basis”
and
“make
concerted
efforts
to
defuse
local
government
debt
risks
while
ensuring
stable
development.”
China’s
real
estate
troubles
are
closely
intertwined
with
local
government
finances
since
they
have
historically
relied
on
land
sales
to
developers
for
a
significant
portion
of
revenue.
The
property
market
slumped
after
Beijing
cracked
down
on
developers’
high
reliance
on
debt
for
growth
in
2020
—
ensnaring
some
of
its
largest
real
estate
developers
in
bankruptcy
and
weighing
on
consumer
growth
and
broader
growth
in
the
world’s
second-largest
economy.
