Sign that China may lower growth targets

BEIJING • China yesterday sent its clearest signal yet that the world's second-largest economy would lower its growth targets, with President Xi Jinping saying annual expansion of only 6.5 per cent would be enough to meet its goals.

Mr Xi's comments came as the ruling Communist Party issued guidelines for its next five-year plan, a release carefully watched by global investors spooked by the country's economic slowdown.

The documents, whose issue followed a leadership conclave last week, did not include a numerical growth target.

China's decades-long boom has given it a crucial role in the world economy, driving demand for commodities and supplying manufactured goods itself.

But now growth is sputtering, with global consequences.

Mr Xi said annual expansion should be no less than 6.5 per cent in 2016-2020 if the country is to double GDP and incomes compared to 2010 levels by the end of the decade.

The target is part of achieving what the Communist Party calls a "moderately prosperous society" in time for the 100th anniversary of its foundation.

"In the next five years, China's development should not just be focused on growth pace, but also growth volume, and, more importantly, growth quality," Xinhua quoted Mr Xi as saying.

The news agency described the 6.5 per cent figure as "China's bottom line" for the period.

The comments are the clearest indication yet that Beijing will reduce its target growth rate from the current "around seven per cent", after expansion slowed last quarter to its lowest pace in six years.

China has faced economic turbulence in recent months as it tries to transition its economy from years of supercharged growth to a more modest pace it has dubbed the "new normal".

AGENCE FRANCE-PRESSE

A version of this article appeared in the print edition of The Straits Times on November 04, 2015, with the headline 'Sign that China may lower growth targets'. Print Edition | Subscribe