On Wednesday, the top policy-makers in charge of China’s economy expressed confidence that the Asian giant will recover this year, despite headwinds that continue to hamper its growth.

Thousands of Chinese MPs have gathered this week in Beijing for the country’s annual parliamentary session. This is traditionally an opportunity for the government to outline its social and economic policy for the year.

“Favourable conditions for China’s economic growth are outweighing unfavourable factors,” said Zheng Shanjie, the national economy’s chief planner, speaking on Wednesday at a press conference held in conjunction with the parliamentary session.

“The economic recovery’s trend will be consolidated and strengthened,” added Zheng, the chairman of the National Development and Reform Commission (NDRC), the agency that manages China’s macroeconomic policy.

Zheng stood alongside some of the country’s top economic officials: Minister of Trade Wang Wentao, Minister of Finance Lan Fo’an, the Governor of China’s Central Bank, Pan Gongsheng, and the head of the market regulatory authority, Wu Qing.

This year’s parliamentary session is being closely monitored by the press, investors and ordinary Chinese, many of whom believe their purchasing power has been undermined in recent years.

They are all waiting for reassuring signs from the leaders of the world’s second-largest economy, which is grappling with a housing crisis, weak exports, low consumption and high youth unemployment.

“Manipulation”

“We are also well aware we will still be facing many challenges and difficulties as we work to achieve the results expected” in 2024, said Zheng. On Wednesday, Trade Minister Wang expressed his concern about “downward pressures” on global growth.

Exports, which are usually a major growth driver for the Chinese economy, were down last year, for the first time since 2016.

A consequence of the decline in global demand for Chinese goods, as developed economies are grappling with inflation, and to a lesser extent of Beijing-Washington friction. In this context, China is struggling to boost its growth. This slump is affecting China’s stock markets, which have generally been bearish for several months.

“Decisive action must be taken to correct market failures,” warned Wu, the head of China’s market regulator, lashing out against “sudden and irrational fluctuations.”
“Cases of market manipulation (…) must be decisively quashed,” he insisted, promising to “tackle any irregularities.”

Press briefing cancelled

These remarks seemed to imply a forthcoming tightening of regulations, and are unlikely to reassure foreign investors, who have already been affected by geopolitical tensions.

On Tuesday, Prime Minister Li Qiang set a growth target of “approximately 5%” for China’s GDP this year.

A growth rate that would delight many developed nations, but for China it remains quite distant from the fast-paced growth that has propelled the country to the top of the global economy in recent decades.

A 5% GDP growth target is also the same as last year and, while it remains one of the lowest since the 1990s, it will still be “hard to achieve,” acknowledged Li.

China announced this week that its prime minister will not hold a press conference at the end of this parliamentary session, breaking with a tradition that has been well established for three decades.
However, Foreign Minister Wang Yi will answer journalists’ questions as expected at a meeting scheduled for Thursday at 02:00 GMT.