Eyes on China's Economic Work Conference... What Is Next Year's Growth Target?

Amid expectations that China will reveal its economic growth target for next year following the Central Economic Work Conference scheduled for mid-month, the market anticipates that authorities will set the target above 5%. Local experts are also citing similar figures based on the ongoing economic recovery trend.

On the 5th (local time), Bloomberg News reported, citing analysts and investors, that officials are expected to pursue an aggressive growth target at the upcoming Central Economic Work Conference this month.

[Image source=Yonhap News]

Goldman Sachs Group economists, including Maggie Wei, stated, "An ambitious growth target could help China mitigate worsening pessimism or negative outlooks in a bleak environment," forecasting that next year’s gross domestic product (GDP) growth target will be around 5%. According to Bloomberg, investment firms such as JP Morgan, Standard Chartered, and Tianfeng Securities also expect China to aim for a growth rate of about 5%.

Furthermore, Bloomberg expects the authorities to introduce more proactive economic stimulus measures to achieve this. Morgan Stanley anticipates that China will issue more government bonds, with the deficit-to-GDP ratio reaching 4% next year.

The central bank, the People’s Bank of China, is expected to adopt a more accommodative monetary policy next year to supply additional liquidity. This includes lowering the reserve requirement ratio to assist banks in purchasing the rapidly increasing government bonds. Experts also predict that the People’s Bank of China may cut policy interest rates early next year.

Lewis Lu, Chief Economist at Oxford Economics, explained, "The People’s Bank of China will maintain loose monetary and liquidity conditions to set relatively relaxed fiscal policies." Duncan Ruggles, Chief China Economist at Pantheon Macroeconomics, emphasized, "Next year’s priorities should include measures to reduce fiscal risks arising from Chinese developers and local government debt."

Earlier, the China Macroeconomic Forum (CMF), a Chinese economic research institution, predicted at its annual forum that "China’s macroeconomic trend continues to recover positively," forecasting that this year’s annual GDP will grow by 5.3% compared to the previous year. The forum set a 5% economic growth target for China next year. Prior to this, according to Taiwan’s Central News Agency, five out of seven advisory members of the Chinese government proposed a 5% economic growth rate for China next year, while the remaining two suggested 4.5% and 5?5.5%, respectively.

This content was produced with the assistance of AI translation services.