Chinese Premier Li Qiang has disclosed that economic growth accelerated in the latest quarter and expressed confidence that it can hit the ruling Communist Party’s official target of 5% set for the year.
Speaking at the World Economic Forum Annual Meeting of the New Champions in the eastern city of Tianjin, Li gave no figure for the three months ending in June but said it was faster than the previous quarter’s 4.5%.
According to the agenda, the three-day summit, which commenced on Tuesday, June 27, 2023 will focus heavily on China’s place in the world and concerns about how the global economy can move forward in an increasingly fractious world.
“It is expected that the second quarter will be faster than the first quarter,” China’s No. 2 leader said. “We expect to achieve the economic growth rate of about 5% determined at the start of the year,” he added.
In March, China’s government announced plans for a consumer-led revival of the struggling economy.
Premier Li Keqiang, the top economic official, set this year’s growth target at “around 5%” following the end of anti-virus controls that kept millions of people at home and triggered protests. Last year’s economic growth in China fell to 3%, the second-weakest level since at least the 1970s.
Following the relaxation of anti-virus limitations on travel and business activities, the second-largest economy in the world recovered from 2022’s unusually low 3% growth. But that vanished quicker than anticipated. May saw a decline in industry and consumer activity as well as a record-high increase in youth unemployment.
From an annual growth rate of 18.4% in April to 12.7% in May, retail sales growth slowed. After interest rates were raised in the US and Europe to reduce inflation, demand for Chinese goods decreased, and manufacturing output growth decreased. Compared to a year ago, May exports were down.
Although some have lowered their projections in light of May’s lackluster performance, private sector forecasts still anticipate China’s economic production to increase by at least 5% this year.
To avoid a further increase in debt, which Beijing fears is already dangerously high, the government of Chinese President Xi Jinping looks to be refraining from a significant economic stimulus.
Li Calls For Deeper Economic Cooperation
Also, Chinese Premier Li Qiang called for more “communication and exchange” to avoid misunderstanding. Li told delegates it was time to support globalization and deeper economic cooperation.
“In the West, some people are hyping up what is called ‘cutting reliance and de-risking‘,” Li said.
“These two concepts… are a false proposition, because the development of economic globalization is such that the world economy has become a common entity in which you and I are both intermingled.
“The economies of many countries are blended with each other, rely on each other, make accomplishments because of one another and develop together. This is actually a good thing, not a bad thing.”
Chinese Premier Li Qiang
The summit is in line with Beijing’s self-branding as a “champion of multilateralism” in a bid to differentiate itself from the United States, where protectionist trade policies directed at China are on the rise.
Due to concerns over national security, the administration of U.S President Joe Biden is anticipated to finalize an executive order in the upcoming weeks that will restrict US investment to China in vital industries such as artificial intelligence, quantum computing, and sophisticated semiconductors.
U.S Treasury Secretary, Janet Yellen has claimed that certain U.S actions, like investment restrictions, are “motivated solely by our concerns about our security and values” and not “to gain competitive economic advantage” over Beijing.
