Beijing sets 2024 growth target higher despite slowing economy

Buildings are seen in Beijing’s central business district, Aug 29, 2010.  REUTERS/Jason Lee/ File photo

BEIJING  – China’s capital city Beijing has set a growth target of around 5 percent for 2024, surpassing last year’s target of above 4.5 percent, despite expectations of slower growth for the national economy.

The economy of the capital city expanded 5.2 percent in 2023, in line with the national economy, which has so far posted feeble post-pandemic growth amid a deepening property crisis, mounting local government debt and persistent deflationary risks.

“The target of around 5 percent is needed to stabilize expectations and boost confidence, to achieve important livelihood goals such as employment and household income,” the Beijing Daily reported on Sunday, citing an unnamed government official.

READ: For many in China, the economy feels like it is in recession

“But a growth rate of around 5 percent is still very challenging, and achieving the goal requires arduous efforts,” the official said.

Beijing aims to control its survey-based urban jobless rate below 5 percent this year.

China’s 2023 economic growth, which was slightly ahead of the annual target of around 5 percent, was partly helped by the previous year’s low-base effect amid COVID-19 lockdowns.

READ: China says economy grew 5.2% in 2023

Chinese leaders have made boosting confidence in the economy a top policy priority, as businesses and consumers are wary of job security, income growth and the housing market.

National growth goal

Beijing’s growth target for 2024 “may serve as a precursor” to a more supportive national growth target, said Tommy Xie, head of Greater China Research at OCBC Bank.

The national growth target is expected to be unveiled at the opening of the annual parliamentary meeting in March.

“This upward revision in the growth target for the current year, even with a higher base, reflects Beijing’s more pro-growth stance,” Xie said in a note.

Policy insiders expect Beijing will maintain a similar growth target of around 5 percent for this year, but analysts say that may be a tall order even with additional stimulus.

Analysts polled by Reuters expected economic growth to slow to 4.6 percent this year.

The southwestern municipality of Chongqing and Sichuan province both set their 2024 growth targets at around 6 percent, while eastern Shandong province aims to grow more than 5 percent this year. Northern Hebei province sets this year’s growth target at around 5.5 percent.