South Asia and Beyond

China Sets No 2020 GDP Goal Due To Coronavirus-Caused Economic Challenges

 China Sets No 2020 GDP Goal Due To Coronavirus-Caused Economic Challenges


MOSCOW: For the first time in years, Beijing will not set a numerical target for its gross domestic product for 2020, according to the text of a government work report from Premier Li Keqiang at the National People’s Congress in China.

“We do not set the specific GDP target mainly due to the global pandemic and big uncertainties about the economy and trade. China is facing unpredictable factors in its development,” Li said in his report.

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He explained the decision to be primarily motivated by the uncertainty created by the Coronavirus pandemic.

“This is because our country will face some factors that are difficult to predict in its development due to the great uncertainty regarding the COVID-19 pandemic and the world economic and trade environment,” he said.

The government will target a 6 per cent urban unemployment rate, compared to 5.5 per cent the previous year, aiming to add over 9 million new urban jobs during the year.

“Specifically, we have set the following targets: over 9 million new urban jobs, a surveyed urban unemployment rate of around 6 per cent and a registered urban unemployment rate of around 5.5 per cent,” the report said.

The central government has set a budget deficit target of 3.6 per cent of GDP this year, up from 2.8 per cent last year, providing more room for cash to tackle the aftermath of the Coronavirus crisis. Besides, the Chinese authorities at all levels were urged to cut budget expenditure over the economic crisis.

“Governments at all levels must truly tighten their belt. The central government will take the lead by committing to negative growth in its budgetary spending, with more than 50 per cent cut to outlays on non-essential and non-obligatory items,” the report said.

One trillion yuan will be released in new “special treasury bonds” this year, and tax cutting measures are set to remain effective until the end of the year.

“This year, the budget deficit will not exceed 3.6 per cent of GDP. Furthermore, public bonds worth 9 trillion yuan will be issued to fight the COVID-19 pandemic,” according to the report.

China also expressed readiness to “boost international cooperation” in fighting the Coronavirus pandemic and to work on stabilizing the global economy that was harmed by the outbreak.

“In the face of the public health crisis, severe economic recession and other global challenges, all countries should work together. China stands ready to work with other countries to strengthen international cooperation on COVID-19 control, promote stability in the world economy, advance global governance and uphold the international system with the United Nations at its core and an international order based on international law,” Li said in the report.

As the nation at the epicentre of the pandemic, China was the first country to impose lockdowns to help slow the spread of the deadly disease. In 2020, China’s economy shrank for the first time in decades. Last year, the Chinese GDP was reported to have grown at 6.1 per cent.

(By arrangement with Sputnik)


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