China sets 'low bar' for GDP growth, pledges more jobs

BEIJING: China on Friday (Mar 5) set a modest annual economic growth target, at above 6 per cent, and pledged to create more jobs in cities than last year, as the world's second-biggest economy planned a careful course out of a year disrupted by the effects of COVID-19.

In 2020, China dropped a gross domestic product growth target from the premier's work report for the first time since 2002 after the pandemic devastated its economy.

China's GDP expanded 2.3 per cent last year, the weakest in 44 years but making it the only major economy to report growth.

"As a general target, China's growth rate has been set at over 6 per cent for this year," Premier Li Keqiang said in his 2021 work report. "In setting this target, we have taken into account the recovery of economic activity."

But the 2021 target was significantly below the consensus of analysts, who expect growth could beat 8 per cent this year. Chinese shares fell.

"If sequential growth averages zero from Q1 to Q4 this year, we will get around 6.1 per cent annual growth this year," Nomura said in a note.

Aninda Mitra, senior sovereign analyst at BNY Mellon Investment Management, said the modest growth target will allow the authorities to emphasise the quality of growth rather than its quantity.

"In the aftermath of the pandemic, a low bar should allow most provinces to cross the hurdle without over-stretching themselves financially," Mitra said.

In 2021, China will target the creation of more than 11 million new urban jobs, Li said in his report delivered at the opening of this year's meeting of parliament.

That is up from a goal of more than 9 million new urban jobs last year, and in line with recent years.

Source: CNA

China GDP COVID-19