China has launched a series of ambitious economic reforms to boost growth amid the economic crisis. Downturn in the housing market and slump in spending –Mainly, this year’s economic growth rate is “approximately 5%.”
“Achieving 5% growth is going to be difficult,” Elaine Dezensky, senior director of the Foundation for Defense of Democracies and director of the Center for Economic and Financial Power, told FOX News Digital.
“China’s financial statistics are becoming increasingly unreliable, and even economic news released after the fact is often questionable,” he said. “China’s unemployment rate has proven to be a serious problem for the Chinese government, with the unemployment rate for individuals aged 16 to 24 reaching a record high of 21.3%, and the government stopping recording and We are being forced to change the way we record unemployment rates.”
Premier Li Qiang, China’s second most powerful leader after President Xi Jinping, gave a work report Tuesday at the annual meeting of the National People’s Congress, outlining a number of reforms his government aims to enact.
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“We shouldn’t Losing sight of the worst case scenario“We must push forward with transforming our growth model, structural adjustment, improving quality and improving business performance,” Li said in an announcement at the Great Hall of the People in Tiananmen Square.
BEIJING, CHINA – MARCH 10: Chinese President Xi Jinping and other government officials conclude the Chinese People’s Political Consultative Conference (CPPCC) at the Great Hall of the People in Beijing, China on March 10, 2022. Attend a meeting. . (Kevin Frayer/Getty Images)
China achieved growth of 5.2% last year, surprising analysts. This growth has occurred at an uneven pace, pointing to structural weaknesses in the economy and prompting government action towards 2024.
Mr Lee acknowledged that achieving the target would be difficult, but remained optimistic, saying an “aggressive” attitude and “prudent” policies were needed. The reforms aim to “promote employment and incomes and prevent risk avoidance”.
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Those involved have acknowledged this. China’s economy faces significant resistanceBut achieving 5% growth by the end of the year provided ample optimism about the country’s ability to continue fighting what could be a catastrophic slowdown in growth.
Prime Minister Alexander Decroo visited the People’s Republic of China from January 10 to 13, 2024 (second day) – Meeting with President Xi Jinping in Beijing, China, on January 12, 2024. (Didier Leblanc/Photonews via Getty Images)
However, as the zero-coronavirus policy severely hampered economic activity throughout the year, the Chinese government was unable to meet its growth target for 2022, achieving only 3% of the target of 5.5%. If these policies end, China’s growth could continue to suffer.
According to the Associated Press, the International Monetary Fund predicted that China would achieve 4.2% growth in 2024, which was revised down slightly from its July 2023 forecast. Investments in real estate development decreased by 7.9% in the first half of 2023 compared to the same period last year.
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“China’s economy is in serious trouble due to a combination of slowing global growth, weak domestic consumer demand, high youth unemployment, and severe vulnerabilities in the real estate sector,” Dezensky said. insisted.
A ship sails near the broken Lixinsha Bridge in Nansha District, Guangzhou City, southern China’s Guangdong Province, Thursday, February 22, 2024. A large container ship collided with a bridge south of the southern Chinese city of Guangzhou in the early morning hours, leaving several people dead and missing. On Thursday, part of the bridge collapsed along with a vehicle. (Lu Hanxing/Xinhua, via AP)
“One of the ways the Chinese Communist Party is likely to deal with the economic downturn is to increase exports,” she said. “Doing so will generate growth, but that growth will not be enough to overcome the major obstacles they face.”
“China faces major economic challenges, and even a huge export machine will not be able to save it this time,” she added. “This also creates new risks for China’s two largest export markets, the US and Europe. Dumping of products such as EVs and solar panels could lower costs for consumers, but these industries It could also crowd out American and European manufacturers at a time when they are starting to decline.” ”
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The overall economic slowdown has changed expectations, with analysts no longer confident that China’s economy can overtake the US economy. Recent forecasts estimate that China will reach peak sales by some point in the 2030s, but many are now questioning whether that will really happen.
Mr. Li said Mr. Jian wanted to curb industrial overcapacity and devote more resources to technological innovation and advanced manufacturing, but this would be a departure from Mr. Xi’s “new productivity” drive. He said that it is part of the
Reuters contributed to this report.
