Premier Li Keqiang’s government work report was a pragmatic and concrete one, pointing out challenges as well as strengths and opportunities, according to a US-based China scholar.
The report, delivered by Premier Li at the opening of the fourth session of the 12th National People’s Congress (NPC) on Saturday, is now being deliberated by some 3,000 deputies.
Cheng Li, director of the John L. Thornton China Center of the Brookings Institution, said the report tells people that the Chinese economy is facing difficulties as a result of structural reforms, the need for better environmental protection and the impact of a sluggish global economy.
“It tells the public that such economic challenges will last for a period of time, so the report does not give the public an unachievable expectation,” Cheng Li said.
Meanwhile, the report has also elaborated on China’s strength, such as the potential to be unleashed in urbanization, the development of the service sector, the employment policy and the innovation policy, according to Cheng Li.
“So this is a report that neither gives the public too high an expectation nor disappointment,” said Cheng Li, whose research has focused on the transformation of Chinese leaders and technological development in China.
Cheng Li believes that this is especially important during the coming two years, or the beginning years of the 13th Five-Year Plan (2016-2020), when there won’t be excessive high economic growth rate, something he said China also does not need.
In the work report, China’s gross domestic product (GDP) growth in 2016 has been set between 6.5 percent and 7 percent. It is the first time since 1995 for the target to be in a range rather than one single number.
China’s economy grew by 6.9 percent in 2015, the lowest in a quarter of a century, but it was still among the highest in the world.
According to the report, an average annual growth of at least 6.5 percent should be maintained in the coming five years in order to achieve the goals of doubling GDP and household income by 2020 from the 2010 levels.
It also says that by 2020, the contribution from scientific and technological advances should account for 60 percent of GDP growth.
Cheng Li said structural reforms will bring a lot of challenges, all of which would require dealing with by the Chinese government.
He described the goals in the work report as very specific. “There isn’t much empty content and slogan type of things,” he said.
“It is what the Chinese public wants to see… and it’s a relatively balanced and good report, one quite pertinent to China’s situation today,” Cheng Li said.
He hoped that the report had emphasized more that many of the challenges are also opportunities. “It is just the beginning and the potential is huge,” he said, citing how areas such as environmental protection could help job creation and business opportunities.
To Cheng Li, the potential opportunities will help small- and medium-sized companies, large companies, Chinese companies overseas and foreign-funded companies in China break new ground.
Cheng Li said the growth targets set in the 13th Five-Year Plan are quite reasonable. “More than 90 percent of what’s in the 12th Five-Year Plan (2011-2015) had been achieved, and there is a better reason to achieve what’s in the 13th Five-Year Plan,” he said.
This piece was originally published by China Daily.
The U.S. still has some leverage over China, because China clearly wants a deal. ... U.S. financial markets also seem to have been boosted by the prospects of a U.S.-China trade deal, so I think it could have a negative effect on both financial markets and economic activity in both countries if a deal is not struck