China sets ambitious growth target of around 5% for 2024

Government is banking on science and technology to transform and lift economy

- Aw Cheng Wei Tan Dawn Wei

BEIJING - China is gunning for an expansion of around 5 per cent in 2024, target economists say is too ambitious and will require strong stimulus given its nagging property woes, deflation risks and poor business sentiments.

The headline growth target contained in Premier Li Qiang's maiden government work report, delivered at the opening of China's annual legislature meeting on March 5, follows 2023's target of around 5 per cent, after the country failed to hit its 2022 goal of about 5.5 per cent.

Official data showed that China's economy grew by 5.2 per cent in 2023 a feat helped by government spending on infrastructure, as well as easing measures, including steps to boost liquidity in the market.

"In setting the growth rate at around 5 per cent, we have taken into account the need to boost employment and incomes, and prevent and defuse risks," Mr Li said in delivering the work report at the Great Hall of the People.

In 2024, the government will aim to create 12 million new urban jobs, and the unemployment rate is projected to be about 5.5 per cent, the report showed. Policymakers also expect inflation to go up by 3 per cent. The projected increases are similar to 2023's targets.

In 2023, besides inflation, which grew a meagre 0.2 per cent, China managed to hit its other targets, keeping to an unemployment rate of 5.2 per cent and creating 12.44 million jobs.

Military spending will rise to 1.67 trillion yuan (S$316 billion), an increase of 7.2 per cent, similar to the increase seen in 2023.