China sets growth “around 5.5%” for 2022, the lowest in three decades

China has set an economic growth target of “around 5.5%” for this year, with prospects clouded by uncertainty surrounding the war in Ukraine, the coronavirus pandemic and, in the internal terrain, problems in the real estate sector. The target announced by Premier Li Keqiang in his opening speech for the annual legislative session is the lowest in more than three decades, with the exception of 2020, when the outbreak of the pandemic left GDP growth at 2 ,two%.

The second economy in the world had set a growth rate “above 6%” last year, which it far exceeded, dragged down by the recovery after the first year of the pandemic and the strength of its exports. In 2021, the increase in GDP was 8.1%, although in the last quarter it was reduced to 4% due to problems in the energy supply, covid outbreaks and the crisis in the real estate sector.

“The covid-19 pandemic continues its course, the global recovery lacks dynamism and the price of raw materials remains high… which makes the situation volatile, difficult and uncertain,” Li declared before the eyes of the deputies, including Chinese President Xi Jinping.

In December, a major state economic meeting warned of a “triple pressure” on the economy, in the form of falling demand, supply-side problems and weaker expectations. The priority should be to stabilize the economy, a call repeated by the politburo, the ruling body of the Communist Party, at its most recent meeting, where it called for financial risk prevention.

Li’s speech to some 2,800 National People’s Congress (NPC) delegates gathered at the Great Hall of the People in Beijing is the Chinese equivalent of the State of the Nation. In it, the prime minister has also announced the goal of creating more than eleven million new urban jobs, which would leave the unemployment rate in cities at 5.5%, a goal similar to that of 2021. Inflation it will remain at 3%, also like last year. The ratio of deficit to GDP is forecast at 2.8%, slightly below the previous year.

Today’s is Li’s last speech to PNA delegates. The prime minister is due to step down after ten years in office next fall, when the 20th Congress of the Communist Party of China is held, at which a renewal of the country’s leadership will be approved. Except for a major surprise, it is expected that Xi, the most powerful president in the country since the times of Mao Zedong, will be confirmed for a third five-year term, breaking with the recent tradition that dictated that the maximum leader leave power after a decade ahead.

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