China maintained its growth target for 2018, despite the economy surpassing the goal last year, as the government aims to contain corporate debt and rein in pollution.
Premier Li Keqiang set the growth target at ‘around 6.5 percent’ for 2018. This was unchanged from the last year’s target.
Premier said in remarks ahead of the annual session of the National People’ s Congress in Beijing on Monday.
The economy achieved a faster growth of 6.9 percent in 2017. Economists widely expect growth to slow this year as the government intends to bring stability in the financial system and curb corporate debt and combat pollution.
The government set the budget deficit target of 2.6 percent of GDP for 2018 compared to 3 percent in 2017. Income thresholds for personal income tax are likely to increase, he said.
Consumer prices will rise ‘around 3 percent’ compared with 3 percent in the previous year.
The economy is likely to create 11 million urban jobs in 2018 and the registered urban unemployment will remain within 4.5 percent, Li said.
The defense spending is forecast to climb 8.1 percent, the fastest in three years. Spending is expected to total CNY 1.11 trillion.
The government plans to reduce steel production capacity by around 30 million tons.
Li said China will keep its prudent monetary policy neutral and will ensure reasonable liquidity. Without mentioning a target, Li said M2 broad money supply growth will remain reasonable.
In a communique, the National Development and Reform Commission said M2 will grow at a pace similar to the rate seen in 2017.
The National People’ s Congress is also expected to remove the two-term limit for President, allowing Xi Jinping to remain in office.