Growth target tops agenda at meeting of China's economic-policy makers
Beijing officials began a highly anticipated annual meeting yesterday to draw up the economic blueprint for next year and set targets for key indicators.
The main issue for international investors is whether the government will stick to a growth forecast of 7.5 per cent or cut it for a second straight year.
Policymakers will also deliberate major issues such as urbanisation, fiscal reform and land reforms at the meeting.
Mizuho Securities economist Shen Jianguang said reform would be the key after the Politburo set the tone last week by promoting structural reforms while maintaining stability.
New data shows industrial output and fixed-asset investment growth eased slightly in November, while retail sales picked up pace. This suggests gross domestic product growth will meet or exceed the official target of 7.5 per cent this year, which compares with 7.8 per cent last year.
The Communist Party's Central Committee last month pledged to deepen economic and social reforms in the coming decade and shift the focus from rapid growth to improving efficiency in a market-oriented economy.
The party's Organisation Department has urged local cadres not to blindly chase growth but pay more attention to technological innovation and environmental protection. Li Xuesong, a professor at the Chinese Academy of Social Sciences, said the authorities might put forward a clearer road map on urbanisation, including land and household registration reform.
The academy suggests the government should lower next year's growth target to 7 per cent. But some officials say the country needs 7.5 per cent growth to ensure employment for the millions of young graduates.
Lu Ting, an economist at Bank of America Merrill Lynch, said Beijing would more likely keep the target at 7.5 per cent, given the domestic and global outlook, impact of reforms and need to maintain public confidence.