China’s “two sessions” will convene next week, setting the stage for the 2025 economic growth target and expected policy measures aimed at fostering recovery amidst trade conflicts. Predictions suggest a target near 5 percent, with emphasis on fiscal spending and support for private sector investments, reflecting potential shifts in regulatory approaches.

Next week, China’s political leaders and lawmakers will convene for the Chinese People’s Political Consultative Conference, followed by the National People’s Congress on Tuesdays and Wednesdays. Known as the “two sessions,” this annual event is crucial in establishing the policy framework for economic recovery while addressing challenges posed by trade and technological conflicts with the United States. The proceedings typically span one week.

The official growth target for 2025 will be disclosed after the sessions, with Dutch multinational bank ING predicting it will remain at approximately 5 percent, similar to the previous year. This forecast reflects a confidence that external pressures will not significantly impact the growth trajectory of Asia’s largest economy.

ING cautioned that a reduction of the growth target below 4.5 percent might indicate heightened economic challenges ahead, which could negatively affect market perceptions. The sessions are anticipated to emphasize increased fiscal expenditures, an elevated debt ceiling of 35.5 trillion yuan for 2024, and the issuance of more special government bonds to stimulate domestic demand.

US broadcaster CNBC has suggested that forthcoming sessions will likely unveil details on additional fiscal measures and may involve a downward revision of the annual consumer price inflation target to approximately 2 percent, a figure not seen in two decades. This inflation target is seen more as a ceiling than a goal, considering the merely 0.2 percent growth in consumer prices from 2023 to 2024.

There may also be discussions regarding a new law that supports non-stateowned enterprises, which is currently under review by officials. Bruce Pang, adjunct associate professor at the Chinese University of Hong Kong business school, anticipates the unveiling of new initiatives aimed at facilitating investment access for private firms and easing financing for small technology companies.

In summary, the upcoming “two sessions” in China hold significant implications for the nation’s economic strategy and regulatory landscape. With expectations of a consistent growth target and potentially enhanced fiscal policies, these deliberations may signal a more supportive environment for private enterprises and technological advancements. The outcomes of these sessions will be pivotal in shaping China’s economic trajectory amidst ongoing global challenges.

Original Source: macaonews.org

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