China holds currently its annual big convention, the National People’s Congress (NPC). The NPC is not a major policy or decision forum but it brings together around 3000 people from all over the country to single out the (economic) state of the country, the outlook for the current year and the strategies behind the plans, particularly the GDP-growth target. Sometimes, also important news may be presented but this mandate is usually more directly in the hands of the most powerful Politburo Standing Committee of the Communist Party. The Prime Minister’s press conference at the end of the NPC week, however, deserves special attention as well. Still, the most interesting event during 2017 will most certainly be the 19th National Congress of the Communist Party of China this coming fall.
On Sunday, March 5, Prime Minister Li Keqiang had his important performance announcing a slight reduction of 2016 year’s GDP-growth target of 6.5-7 % to around 6.5% in 2017 or better if possible (outcome 2016: 6.7%). This is certainly only a minor adjustment and within the limits of accuracy of statistical measurement (which still is not very precise when it comes to Chinese GDP). Anyway, Chinese growth expectations have really come down during the past few years – but China still cares strongly about “employment and the improvement of people’s lives” according to Li Keqiang. This certainly includes the environment. It can be added that Prime Minister Li really did not play down various major risks for the Chinese economy – but positive signals dominated.
There are altogether nine top priorities determining Chinese economic policy during 2017. The details are certainly not new but positively repeating major objectives from the important strategic Third Plenum in 2013. The encouraging conclusion is that reform policy is still on track – and hopefully also after the 19th National Congress of the Communist Party of China (even if certain goal conflicts do not allow for an optimization of all the 60 reform chapters from 2013). Compromises will be needed.
Read more about the top nine priorities of the government for 2017 in an interesting document edited by the State Council (chairman: the Prime Minister) from March 5, 2017:
Affiliate Professor at the School of Business and Economics, Linnaeus University