BEIJING, March 5 (WSH) — China has set the GDP growth target at “around 5 percent” for 2025, maintaining last year’s goal as the government intensifies efforts to stimulate domestic demand and implement more supportive policies, according to the Government Work Report released on Wednesday.
Premier Li Qiang, delivering the report at the opening of the third session of the 14th National People’s Congress in Beijing, said the target is “well aligned with the country’s mid- and long-term development goals” and underscores “the resolve to meet difficulties head-on and strive hard to deliver.”
The report outlines a more proactive fiscal policy and a moderately loose monetary policy for 2025, with the deficit-to-GDP ratio projected at 4 percent, up from 3 percent last year. China will issue 1.3 trillion yuan ($178.95 billion) in ultra-long-term special treasury bonds, up from 1 trillion yuan in 2024, while 500 billion yuan will be allocated to support large State-owned commercial banks in replenishing capital.
The special local government bond quota will increase to 4.4 trillion yuan, from last year’s record high of 3.9 trillion yuan. New government debt will total 11.86 trillion yuan, an increase of 2.9 trillion yuan over last year, providing a notably higher level of spending, the report stated.
In monetary policy, the report noted that China will make “timely cuts to the reserve requirement ratio and interest rates” while refining new structural monetary policy instruments to “provide stronger support for the sound development of the real estate sector and the stock market.”
The government also set the consumer price index (CPI) target at “around 2 percent”, marking the first time since 2005 that the figure has been set below 3 percent. The report outlines efforts to “better balance supply and demand through a combination of policies and reform measures so that the general price level will stay within an appropriate range.”
In labor market policies, China aims to create more than 12 million urban jobs and keep the surveyed urban unemployment rate at around 5.5 percent, ensuring stability in employment.
To encourage foreign investment, the report stated that China will “open internet-related, cultural and other sectors in a well-regulated way”, while expanding trials in telecommunications, medical services, and education. Additionally, the government pledged to “effectively protect the lawful rights and interests of private enterprises and entrepreneurs in accordance with the law.”
On risk management, the report called for city-specific policies to “adjust or reduce property transaction restrictions”, while taking steps to “effectively prevent debt defaults by real estate companies.” Additionally, 300 billion yuan in ultra-long-term special treasury bonds will be issued to support consumer goods trade-in programs, and strategic resource reserves and market stabilization mechanisms will be strengthened.
Tian Xuan, a deputy to the 14th NPC and head of the National Institute of Financial Research, Tsinghua University, said the “GDP growth target of around 5 percent” reflects policy continuity and is a goal that “we need to strive for and reach with extra effort, which can effectively inspire all people across the country to work hard together.”
Janice Hu, China country head at UBS AG and chairperson of UBS Securities, said that the government is expected to prioritize “stabilizing growth” as the central task this year, emphasizing “boosting domestic demand with more supportive macro policies.”
“These much-anticipated measures could gradually help underpin household confidence and unleash consumption potential in the long run,” Hu said, adding that UBS will continue to invest strategically in China.
