China wants to improve the economy
Chinese Premier Li Qiang announced an ambitious 2024 economic growth target of around 5% on Tuesday, promising steps to transform the country's development model and defuse risks fuelled by bankrupt property developers and indebted cities.
"It's harder to reach 5% this year because the benchmark has become higher, indicating that senior executives are committed to supporting economic growth," said Tao Chuan, chief macro analyst at Soochow Securities.
Last year's uneven growth exposed deep structural imbalances in China, from weak household consumption to increasingly low returns on investment, prompting calls for a new growth model. China began the year with a stock market crash and deflation at levels not seen since the 2008-09 global financial crisis.
Li acknowledged that achieving the target "will not be easy," adding that a "proactive" fiscal stance and "prudent" monetary policy are needed.
