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Course set to seek higher-quality development

By Andrew Mooday | China Daily | Updated: 2021-03-11 06:44
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(from left to right)Louis Kuijs, head of Asia at Oxford Economics; George Magnus, research associate at the Oxford University China Centre; Douglas McWilliams, executive deputy chairman and founder of the Centre for Economics and Business Research and Zhu Ning, a professor of finance at the Shanghai Advanced Institute of Finance. [Photo provided to China Daily]

China has been set on a course to achieve higher-quality development and to further open up its economy, according to leading experts.

They were responding to the Government Work Report, which was delivered by Premier Li Keqiang at the opening of the annual session of the National People's Congress, China's top legislature, on Friday in Beijing.

In the report, which sets out future goals as well as reviewing the past year, Li set a target of "above 6 percent" for GDP growth over the next year.

He also indicated that China would not resort to the same fiscal stimulus led by infrastructure spending that was seen last year, during the early months of the pandemic, given that the fiscal deficit this year is to be cut to 3.2 percent of GDP.

With many expecting China's economy to grow more than 8 percent this year from the low base of 2.3 percent last year, economists have welcomed the room that Li has given policymakers to rebalance the economy.

Stephen Roach, an economist and senior fellow at the Jackson Institute for Global Affairs at Yale University in the United States, said the report was a move away from strict targeting and was a "welcome development".

He said China is now committed to upgrading its economy and delivering high-quality growth.

"Barring another shock, Chinese GDP growth will easily exceed the low bar of 6 percent," he said.

"The emphasis on manufacturing, research and development, supply chain digitization and productivity all reaffirm the government's longstanding emphasis on upgrading to higher-quality growth-continuing the transition away from earlier emphasis on the quantity dimension of the growth experience."

Yue Su, principal economist at The Economist Intelligence Unit, an economics research organization, agreed that the actual GDP outcome is likely to easily surpass 6 percent.

"A flexible target aims to give greater room for policymaking. It will enable the authorities to concentrate on promoting reform and innovation," she said.

Jeremy Stevens, chief China economist at Standard Bank, Africa's largest bank, said China's remarkable recovery from the COVID-19 pandemic-it was the only major economy to grow at all last year-was reflected in the upbeat nature of the report. He said he thinks the economy could potentially grow 8 percent this year.

"The tone was rightly confident, given the manner in which COVID-19 has been managed, and set the scene for the economic recovery," he said.

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