An air view of a new city circle in the city of Nanning, South China on February 28, 2025.
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China on Wednesday decided its target of GDP growth for 2025 to “about 5%” after starting its annual parliamentary meeting between the Tensions of escalating with the US, according to a copy of the first CNBC government work report.
Beijing raised its goal of budget deficit in “about 4%” of GDP from 3% last year.
The 4% deficit would score the highest in the record going back to 2010, according to the data to be achieved through wind information. The preliminary high was 3.6% in 2020, the data showed.
The government report set out a plan to issue 1.3 trillion Juan Juan Special Treasury Bono in 2025, 300 billion yuan more than last year. 500 billion yuan will be issued with particular treasury value to support large state -owned trading banks.
The report reiterated the Beijing plan to “approve a more proactive fiscal policy”.
In an implicit recognition of the slow domestic demand, Beijing also reviewed its annual target of consumer price inflation in “about 2%” – the lowest in more than two decades – from 3% or higher in previous years, according to the Asia Society Policy Institute.
The new purpose of inflation would act more as a ceiling than a goal to accomplish. Consumer prices only climb 0.2% to 2024 and 2023, while manufacturer prices have fallen for more than two years.
The country’s annual parliamentary meeting, known as the “two sessions”, began on Tuesday with the opening ceremony of the Chinese people’s political consultative conference – a high advisory body.
The National Congress of the People began its meeting on Wednesday and is expected to complete its annual session on March 11. The Foreign Minister and the leaders of some economic departments will hold press conferences in the meantime.
Tit-for-tat fees
This year’s parliamentary meetings come after Trump has imposed new tariffs on Chinese goods – 20% extra tasks in just one month.
Beijing Tuesday responded with additional fees of up to 15% for some US goods from March 10, and restrictions on exports to 15 US companies. China also added 10 US firms to a list of unreliable units that can limit their ability to do business in the Asian country. Many of the US -appointed businesses work in airspace, protection or drone.
“We hope to work with the US side to address each other’s concerns through dialogue and consultation based on mutual respect, equality, reciprocity and mutual improvement,” Lou Qinjian told the third session of the 14th National Congress for the morning newspapers.
“At the same time, we never accept any act of pressure or threat, and will strongly defend the sovereignty, security and interests of our development,” he said in Mandarin, through an official translation.
Stimulus and technology
US raised tasks will weigh on China’s exports, a rare bright country in an economy that fights with internal domestic demand.
While the world’s second largest economy increased by 5% in 2024, retail growth fell significantly to 3.4% from 7.1% in 2023. Real estate dragging continued, with sector investments falling by 10.6% last year, a year earlier.
Investors have closely looked at Beijing’s efforts to address the country’s economic slowdown after a sudden, high -level promise of support in September, promoted a stock rally. Market profits were again elected after Chinese President Xi Jinping held a rare meeting last month with entrepreneurs including Jack Ma to Alibaba and the beginning of the artificial intelligence Deepseek’s Liang Wenfeng.
“There is no denial that technologies and it are accompanied by some unknown risks and challenges and will bring new tasks to areas such as security, social governance, morality and ethics … will inevitably have an impact on production,” Lou said.
“China … is opposed to extending the concept of national security or politicization of economic and technological issues,” he said.
Investors will also closely look at parliamentary meetings for further commentary on artificial intelligence and China’s efforts to provide regulatory security for the private sector.
– CNBC Bernice OOI contributed to this report.