Chinese Premier confident of achieving growth target this year

Despite recent figures falling short of expectations, Chinese Premier Li Qiang believes the country's economy is still on track to achieve growth around 5%.

Speaking at the World Economic Forum's (WEF) annual Pioneers Conference in Tianjin, China, on June 27, Chinese Premier Li Qiang said the country is still on track to achieve its GDP growth target of around 5% this year. He predicted higher growth in the second quarter than in the first.

"From what we've seen, the Chinese economy is showing clear signs of recovery and improvement," Li affirmed.

China's economy grew by 4.5% in the first quarter – higher than expected. However, May economic figures, from retail sales to fixed asset investment, fell short of analysts' expectations.

Chinese Premier Li Qiang at the WEF on June 27. Photo: Reuters — Chinese Premier Li Qiang at the WEF on June 27. Photo: *Reuters*

Recently, a number of major banks have lowered their growth forecasts for China this year. Goldman Sachs on June 18th reduced its forecast from 6% to 5.4%. Nomura Holdings predicts China's GDP will grow by only 5.1%. UBS estimates the rate at 5.2%. Standard Chartered expects a growth rate of 5.4%. JPMorgan lowered its forecast from 5.9% to 5.5%.

"Nowhere has lost momentum after reopening its economy as quickly as China. We believe the challenges to growth will persist. Officials are having to consider many economic and political factors to come up with appropriate stimulus measures," said Hui Shan, an analyst at Goldman Sachs.

As factory production slows amid weak domestic and international demand, Li said today that China will roll out more effective policies to stimulate demand and open up markets. He also pledged to continue allowing China to play a role as a driver of global economic growth.

The Chinese Premier believes the pandemic will not be the last health crisis the world faces. He said that Covid-19 will end and both tangible and intangible challenges will disappear.

He also warned governments against politicizing the economy, which he said was dividing the world. "Some Western countries are pursuing what they call independence and risk mitigation. But these two concepts are misguided goals. Globalization has transformed the global economy into a unified whole. The interests of everyone are closely intertwined," he said.

The Chinese Premier therefore called on countries to cooperate in addressing global challenges and regional conflicts. This statement comes at a time when US-China relations have deteriorated in recent years and the prolonged conflict in Ukraine threatens global energy markets.

Ha Thu (according to Bloomberg)

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