SHANGHAI — China’s economy is not at risk of a hard landing and its goals for growth are eminently achievable. Those were the main messages from the country’s leadership at the conclusion of the annual meeting of China’s national legislature in Beijing on Wednesday.
“We are full of confidence in the long-term good prospects of the Chinese economy,” Premier Li Keqiang was quoted as saying by local media at a press conference at the close of the National People’s Congress. “As long as we stick to reform and opening up, China’s economy will not see a hard landing.”
Li also talked up China’s potential as a center of entrepreneurship and innovation, talked down the potential for further fluctuations in local stock markets and spoke about the bilateral investment treaty currently being negotiated with the U.S.
“As long as the two sides act in good faith and properly manage their differences, I believe our common interests can be further expanded,” he said. “As our cooperation expands, the number of differences may naturally rise, but the percentage of differences in the overall China-U.S. relationship will only come down.”
Li, China’s top economic official, also reiterated the country’s growth target for this year would be between 6.5 and 7 percent, and said China will be able to retain this level of growth for the period of the current five-year plan, which was also approved by NPC delegates on Wednesday.
The plan is essentially the country’s economic and social development blueprint for 2016 to 2020, which sets targeted average annual economic growth at above 6.5 percent for the next five years.
A total of 2,778 lawmakers, or more than 97 percent of NPC delegates, voted for the five-year plan at the closing meeting of the body’s annual session.
China has set 2020 as the target year to build a “moderately prosperous” society, pledging to double GDP and per capita personal income from the 2010 level before the Communist Party of China celebrates the 100th anniversary of its founding in 2021.
The implementation of this latest five-year plan comes at a time when China’s apparel industry is facing challenges — rising wages, weak demand and price pressure.
“Looking at apparel specifically, I think we are probably going to see more and more apparel manufacturers shifting their operations offshore to Vietnam or India, or to factories in inland China,” said Benjamin Cavender, principal at China Market Research Group. “Many of these companies are operating on very low margins. Over the long-term, China is still going to have a leading role in apparel manufacturing simply because it has such a strong supply chain and logistics network, but in the near-term a lot of Chinese producers are hurting.”
Lu Ming, an economic professor at Shanghai Jiao Tong University said: “This year’s growth could be stabilized if the government carries a correct expansionary policy that is being seen. This will be good for consumption growth and textile in general.”
According to the latest five-year plan, by 2020, the size of China’s economy is expected to exceed 90 trillion yuan (or $13.8 trillion), compared with 67.7 trillion yuan in 2015.