Chinese Premier Li Keqiang on Friday attributed the decision to “factors that are difficult to predict” due to “great uncertainty” caused by Covid-19 and “the world economic and trade environment.”
This is the first time in decades that China has not set a growth target for its economy. Last year, Beijing targeted growth in the range of 6% to 6.5%. GDP grew 6.1%, its slowest pace in nearly 30 years.
The coronavirus pandemic and a weeks-long shut down throughout much of China dealt a historic blow to the country’s economy. GDP shrank 6.8% in the first quarter, the first contraction that Beijing has reported since 1976.
Tens of millions of people were forced out of work by the pandemic, and analysts suspect the unemployment problem is larger than what Beijing has reported.
China’s economy also faces external pressure. The global pandemic has caused a slump in the demand and weighed on China’s enormous exports sector.
And tensions between the United States and China are flaring up again, raising the possibility that the two could resurrect their trade war.
Li, who made the announcement about a lack of a GDP target at this year’s annual meeting of the National People’s Congress — the country’s rubber-stamp parliament — instead announced a series of other targets that the government has set for this year.
Beijing wants to create nine million new urban jobs to help bolster employment in the country, he said, which is a key priority. Li also outlined goals to help ensure basic living standards and eliminate poverty.
“Faced with changes in the external environment, we must stay committed to opening our door wider to the world, keep our industrial and supply chains stable, and make opening up a catalyst for reform and development,” Li said.
— This is a developing story.