1 / 8Chinese Premier Li Qiang revealed Beijing’s targets and the action plan to hit the 5% target for economic growth third year in a row. Aside from the promised spending to boost consumer demand, defence, and housing, some of the big highlights included the end of ‘illegal investigations against the private sector that hurt the business sentiment in recent years. Pictture of Li Qiang at the Great Hall of the People in Beijing, China, March 5, 2025. REUTERS/Florence Lo
2 / 8China aims to create over 12 million new urban jobs in 2025, promises ‘moderately loose’ monetary policy and to boost consumer demand through special initiatives. The above graphic is sourced from a Bloomberg report, which analysed the latest government work report and previous ones. Pls note that the 2025 consensus forecast reflects the media projection of 26 economists polled by the news agency in late February. Local government special bond issuance in 2024 was increased to 4 trillion yuan compared to 3.9 trillion budgeted earlier.
3 / 8China is set to increase its defense spending by about 7.2% in 2025 to 1.78 trillion yuan ($245 billion) in 2025, according to news reports. China’s outlay on the People’s Liberation Army has risen by at least 6.6% each year for the past three decades, though its actual funding figure is likely much higher than the official one. Last year, the Pentagon estimated that the total amount was around $330 billion to $450 billion, or 1.5 to two times what was publicly announced, a Bloomberg report added. Premier Li Qiang also said that China is working to “firmly advance” reunification with Taiwan. The comment coming days after US President Donald Trump’s spat with Ukraine’s Volodymyr Zelenskyy at the White House may further deepen the fears of Chinese onslaught on Taiwan.
4 / 8Amidst a stubborn deflation and housing sector woes, China has set the fiscal deficit target at 4%, the highest in over three decades. Domestically, the foundation for China’s sustained economic recovery and growth is not strong enough. Effective demand is weak, and consumption, in particular, is sluggish,” Li said on March 5. China will issue 1.3 trillion yuan ($180 billion) in ultra-long term bonds, up 30% from last year. The increased bond issuances will fund the extension of rebates to consumers who trade in automobiles or appliances for new ones.
5 / 8China plans to issue 500 billion yuan ($69 billion) in special sovereign bonds as it seeks to boost capital at its biggest banks to support the economic recovery. Li also said that the central bank would cut interest rates as well as the reserve requirement of the banks to boost credit. Image: Shanghai, China. Photographer: Raul Ariano/Bloomberg
6 / 8In a bid to revive the country’s ailing real estate sector, China pledged to give city governments more say in how they buy unsold homes. A total of 4 trillion yuan has been reallocated from local government budgets to swap out hidden debts over five years, with 800 billion yuan used annually through 2028, according to a report by South China Morning Post. Chinese Premier Li Qiang attends the opening session of the National People’s Congress (NPC) at the Great Hall of the People in Beijing, China, March 5, 2025.REUTERS/Florence Lo
7 / 8Li also promised to open up access to internet sector “in an orderly manner” and allow foreign investors to increase their bet on China. He also vowed to curb ‘motivated’ law enforcement against local companies and provide policy support for their ‘legitimate rights’. The Chinese premier highlighted in his speech that the emerging industries contributed to 10% of China’s GDP in 2024. REUTERS/Tingshu Wang
8 / 8President Xi Jinping has pledged to turn China into a “medium-developed country” by 2035. This would require the world’s second-largest economy to double its size from 2020 and the economy has to grow consistently at 5% or more, according to economists who spoke to Bloomberg. Policymakers in Beijing would hope the latest measures articulated by premier Li Qiang would be able to unleash the animal spirits in an economy that has been in the doldrums and be able to tackle the tariff war unleashed by the Donald Trump administration in the US. In the picture, Chinese President Xi Jinping arrives at the Great Hall of the People on the day of the opening session of the National People’s Congress (NPC), in Beijing, China March 5, 2025. REUTERS/Tingshu Wang
