Hong Kong (CNN) China It has set an official economic growth target of “around 5%” for 2023, as it seeks to revive the world’s second-largest economy a year after tepid growth due to pandemic measures.
It will also expand its defense budget by 7.2%, up slightly from growth in the previous year.
Both numbers for next year were released at the opening of the annual gathering of the National People’s Congress (NPC), the country’s rubber-stamped legislature, which draws nearly 3,000 delegates to Beijing over the next eight days.
“China’s economy is experiencing steady recovery and showing huge potential and momentum for further growth,” outgoing Premier Li Keqiang told delegates while presenting the government work report at the opening of the conference on Sunday.
The economy added more than 12 million urban jobs last year, with the urban unemployment rate falling to 5.5%, according to the work report, which underscored China’s focus on ensuring stable growth, employment and prices amid global inflation and setting a GDP target.
China unveiled its annual military budget for 2023, which will increase 7.2% to nearly 1.55 trillion yuan ($224 billion), in a draft budget report also released Sunday morning.
The spending increase represents the second year in a row in which the annual rise in military spending has exceeded 7% and exceeds the 7.1% growth of last year, amid escalating geopolitical tensions and regional arms race. As with other recent years, the number remains well below the signature double-digit expansion.
Li’s work report said: “The armed forces should intensify military training and readiness in all fields, develop new military strategic directions, devote more energy to training under combat conditions, and make well-coordinated efforts to strengthen military action in all directions and fields.”
The GDP target and military spending are among the most closely watched activities of the Opening Day sessions, with the GDP target number in particular being watched this year as China exits its no-Covid economic policy. The new figure looks modest against what some analysts had predicted might be a more aggressive target for next year.
The meeting of the National People’s Congress is a major annual political event that occurs alongside the meeting of China’s highest political advisory body, with events known as the Two Sessions.
This is the first two sessions since Chinese leader Xi Jinping got the A third period in violation of the standards At the top of the hierarchy of the Chinese Communist Party in October. Xi is set to enter his third term as president, a largely ceremonial title, during the conference.
Chinese Premier Li Keqiang speaks during the opening session of the National People’s Congress at the Great Hall of the People in Beijing, on Sunday, March 5.
economic recovery
China’s GDP expanded by just 3% in 2022, widely exceeding the official target of “around 5.5%” mainly due to prolonged Covid restrictions. It was the second-lowest annual growth rate since 1976, behind only 2020 – when the initial Covid outbreak occurred. It could cripple the economy.
In December, after the Communist Party It ended abruptly Its Covid-free policy, a massive wave of infections swept across the country, crippling supply chains and factories in disarray. But the unrest began vanish In January, the economic recovery accelerated last month.
Official data released on Wednesday showed Chinese factories It was their best month In nearly 11 years in February, underscoring how quickly economic activity rebounded after the end of the Covid exit wave. The services and construction industries also achieved their best performance in two years.
Moody’s Investors Service has since raised its growth forecast for China to 5% for both 2023 and 2024, up from 4% previously, citing a stronger-than-expected recovery in the short term.
Analysts predicted a difficult recovery path for China amid global headwinds, which could also be reflected in the conservative 2023 target of “around 5%” announced on Sunday.
The global economy will Weaken more this year With rising interest rates and the Russian war in Ukraine continuing to weigh on activity, the International Monetary Fund estimated in January. Global growth is likely to slow from 3.4% in 2022 to 2.9% in 2023.
China is set to publish import and export data for the first two months of this year on Tuesday, which will provide a snapshot of global trade demand.
During the congress, the ruling Communist Party’s new economic team, including several ministers and chief financial officials, will be unveiled, while also accepting other key appointments – already selected by the Communist Party leadership. Premier Li’s replacement will be formally appointed during the meeting, which lasts until March 13.
The new economic team will face the difficult task of reviving the Chinese economy as it faces a growing set of challenges, including slowing consumption, rising unemployment, a historic decline in real estate, and increasing tension with the United States over technology sanctions.
military spending
The 7.2% increase in planned defense spending marks the first time in the past decade that the rate of budget growth has increased for three consecutive years, as Beijing continues to modernize and build its military, while emphasizing pressure on Taiwan – the ruling island nation – the Chinese Communist Party claims to be his own even though he never reigned.
China now controls The largest marine in the world In terms of size, it continues to develop its fleet of nuclear submarines and stealth fighter aircraft.
The military budget expanded 7.1% to 1.45 trillion yuan in 2022, compared to 6.8% in the previous year. Last year, China’s annual defense spending grew by double digits in 2015. This year’s budget size is more than double that of decades ago.
Chinese officials have repeatedly sought to portray their military spending as reasonable relative to other countries like the United States — as part of China’s attempt to present itself as a peaceful power, despite its aggression in the region including Militarization of the South China Sea Extensive patrols around Taiwan.
During a press conference on Saturday before the opening day, NPC spokesperson Wang Zhao said that China’s defense budget has maintained a “relatively moderate and reasonable growth rate.”
“China’s defense spending as a percentage of GDP has remained stable over the years. It remains basically stable, below the global average,” Wang said.
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