China’s New Economic Agenda, a Lot Like the Old One: Takeaways

Beijing was abuzz with politics on Tuesday. China’s annual legislative meeting — the National People’s Congress, when Communist Party leaders promote their solutions for national ills — opened for business.

The event is a chance for the leaders to signal the direction of the economy and outline how and where the government will spend money in the coming year.

Yet while aiming high, they offered little. Officials signaled that they were not ready for any showstopping moves to revive an economy battered by a property crisis, the loss of consumer confidence and financial pressures of indebted local governments. Despite their reluctance to spend, China’s top leaders said the economy would grow around 5 percent this year.

The growth target and other policies came in a report given to the annual session of the legislature. It was delivered by China’s No. 2 official, Li Qiang, and is the marquee event in a weeklong gathering dominated by officials and party loyalists.

Everyone agrees: The target is ambitious.

There was one word economists universally used to describe China’s growth target of 5 percent: ambitious.

That once wouldn’t have been the case. For decades, China’s economy was synonymous with much higher growth, sometimes even in double digits. But three years of strict pandemic measures took a toll, and a deepening real estate crisis that has led to the collapse of dozens of developers. With China’s leaders short on action, some experts are now skeptical that China will pull off 5 percent growth this year.