Despite recent disappointing figures, Chinese Premier Li Qiang said the country's economy is still on track to grow around 5%.
Speaking at the World Economic Forum (WEF) annual Pioneers Meeting 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 that growth in the second quarter would be higher than the first quarter.
"From what we see, the Chinese economy is showing clear recovery and improvement," Mr. Li affirmed.
China's economy grew 4.5% in the first quarter, beating expectations. However, economic data for May, from retail sales to fixed asset investment, fell short of analysts' expectations.
Chinese Premier Li Qiang at the WEF on June 27. Photo: Reuters
Recently, a series of major banks have lowered their growth forecasts for China this year. Goldman Sachs on June 18 lowered the rate from 6% to 5.4%. Nomura Holdings forecasts China's GDP to grow by only 5.1%. UBS thinks the rate will be 5.2%. Standard Chartered expects growth of 5.4%. JPMorgan lowered it from 5.9% to 5.5%.
“Nowhere has the recovery momentum from reopening been lost as quickly as China. We expect growth challenges to persist. Officials are weighing a number of economic and political factors to decide on the appropriate stimulus,” said Hui Shan, an analyst at Goldman Sachs.
As factory production slows amid weak domestic and foreign demand, Li said today that China will roll out more effective policies to stimulate demand and open up its market. He also pledged to continue to let China serve as a growth engine for the global economy.
The Chinese premier said the pandemic will not be the last health crisis the world faces. He said Covid-19 will end and the visible and invisible challenges will also disappear.
He also warned governments against politicizing the economy, which would divide the world. "Some Western countries pursue what they call independence and risk reduction. But these two concepts are the wrong goals. Globalization has turned the global economy into a unified whole. Everyone's interests are tightly bound together," he said.
The Chinese premier therefore called on countries to cooperate to address global challenges and regional conflicts. This statement was made at a time when US-China relations have deteriorated over the past few years and the prolonged war in Ukraine threatens the global energy market.
Ha Thu (according to Bloomberg)
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