China Sets Modest Growth Target Of About 5% As Parliament Opens

• China set a modest target for economic growth this year of around 5% on Sunday as it kicked off the annual session of its National People's Congress (NPC), which is poised to implement the biggest government shake-up in a decade.
• China's gross domestic product (GDP) grew by just 3% last year, one of its worst showings in decades, squeezed by three years of COVID-19 restrictions, the crisis in its vast property sector, a crackdown on private enterprise, and weakening demand for Chinese exports.
• This year's growth target of around 5% was at the low end of expectations, as policy sources had recently told Reuters a range as high as 6% could be set. It is also below last year's target of around 5.5%.
• Beijing faces a host of challenges, including increasingly fraught relations with the United States and a worsening demographic outlook, with plunging birth rates and a population drop last year for the first time since the famine year of 1961.
• China plans to lower the costs of childbirth, childcare, and education and will actively respond to an ageing population and a decrease in fertility, the nation's state planner said in a work report released on Sunday.
• "While the official growth target has been lowered for the second consecutive year, which might be a disappointment to the market, we reckon investors (should) pay attention to the underlying growth momentum to gauge the recovery pace," said Zhou Hao, an economist at Guotai Junan International.

(Source: Reuters)