BEIJING (Reuters) – China’s economy is stabilising and improving but still faces many challenges, Premier Li Keqiang was quoted by state media as saying at a cabinet meeting on Wednesday.
China will take measures to improve market expectations and consolidate economic growth momentum, and there is still room for tax and fee cuts to take effect, said Li.
The world’s second largest economy grew 3% in 2022 from a year earlier, badly missing the official target of around 5.5% and recording one of its worst rates in nearly half a century.
Beijing’s lifting of stringent anti-COVID measures in December has boosted a tentative economic revival this year, but a property slump and weak global demand also mean a rebound in growth will be heavily reliant on consumers.
Markets widely anticipate a government reshuffle, especially of the economic team, and economic targets for 2023 during an annual session of parliament kicking off in early March.
“We believe 5% will remain this year’s growth target, though in practice 5% is perhaps now being interpreted as a minimum,” J.P. Morgan said in a research note. It expected monetary policy “to be continuous and maintain the status quo, and fiscal policy to be modestly contractionary this year”.
(Reporting by Liangping Gao and Ryan Woo; editing by John Stonestreet and Mark Heinrich)
