Growth and reform in tug of war as Chinese leaders grapple with hard choices
Premier Li Keqiang’s focus on GDP targets suggests that stabilisation – and not restructuring – is the top priority for this year, economists say
Just three months ago, Chinese leaders approved an annual economic blueprint that suggested reform would be this year’s top priority.
It was part of a push to tackle deep-seated structural problems such as overcapacity, bad debt and worsening income gap.
But with the world’s second-largest economy battling headwinds, the government’s bigger priority now seems to be growth, economists say, citing policy documents and remarks by leaders at the annual session of the National People’s Congress.
The reform tone was set late last year. The annual Central Economic Work Conference declared that supply-side reform – which favours less government involvement and greater play for the market – would be a major feature of China’s economic and social policies in 2016 and beyond.
But after the NPC ended on Wednesday, Premier Li Keqiang pledged that the country would achieve its 6.5 per cent minimum growth target, all the while insisting that this would not mean sacrificing planned supply-side reform.
READ MORE: We’ll stabilise China’s economy: Premier Li Keqiang sets the tone for the year ahead
