Full-text & highlights of government work report

China targets economic growth of around 5% in 2024

Chinese Premier Li Qiang, on behalf of the State Council, delivered a government work report at the opening meeting of the second session of the 14th National People's Congress, held at the Great Hall of the People on Tuesday morning. The year of 2023 was the new-term government’s first year to perform its duties in accordance with the law.

According to the government report, China targets economic growth of around 5 percent in 2024. A proactive fiscal policy and a prudent monetary policy will be continued, with the ratio of deficit to gross domestic product (GDP) set at 3 percent. The country expects to create over 12 million jobs in urban areas and keep the surveyed urban unemployment rate at around 5.5 percent this year.

The central government expenditures are projected at 4.152 trillion yuan, an increase of 8.6 percent this year. The main expenditures are as follows: 60.783 billion yuan on diplomatic endeavors, up 6.6 percent; 1.66554 trillion yuan on national defense, up 7.2 percent; 227.662 billion yuan on public security, up 1.4 percent; 164.936 billion yuan on education, up 5 percent; 370.828 billion yuan on science and technology, up 10 percent; 140.636 billion yuan on stockpiling grain, edible oils, and other materials, up 8.1 percent; and 777.315 billion yuan on debt interest payments, up 11.9 percent.

We have uploaded the Report on the Work of the Government [Chinese] [English], the Report on China's national economic and social development plan [Chinese][English], and the Report on China's central and local budgets [Chinese][English] to Google Drive for you to download and share with others. Please note that the official Chinese version of the reports will be released by Xinhua News Agency/此报告以本次大会最后审议通过并由新华社公布的文本为准.

We have also updated the agenda and schedule of this year’s Two Sessions.

---

Some photos from the scene and information about key data in the report：

A tweet from Bloomberg Reporter Colum Murphy about his on-the-ground experience at today's session.

Bloomberg has posted a comparison between this year's government economic targets and those of last year.

The following image shows the scene outside the Great Hall of the People today, where today’s meeting was held. Photo credit belongs to Dong Xue, journalist from CGTN. Is there any subscribers of this newsletter at the meeting today?

Last year, I wrote a piece translating Li Qiang’s introductory press conference, introducing his background, and a compilation of highlights from interviews and reports about the premier from Chinese officials, scholars, entrepreneurs, and media outlets on The China Project.

Below are the highlights of the government work report delivered by Premier Li today. They are selected by me, focusing mostly on the achievement, difficulties, and challenges of the work in 2023 and the government's major tasks in 2024.

Summarizing the achievement and challenges over the past year

2023 was the first year for fully implementing the guiding principles from the 20th National Congress of the Communist Party of China (CPC). It was also this government’s first year to perform its duties in accordance with the law. In the face of an unusually complex international environment and the challenging tasks of advancing reform and development and ensuring stability at home, the Party Central Committee with Comrade Xi Jinping at its core brought together the Chinese people of all ethnic groups and led them in withstanding external pressures and overcoming internal difficulties with dedicated efforts.

......

Looking back at 2023, we can see that as we faced an array of interwoven difficulties and challenges, China’s economy grew in a wave-like fashion amid twists and turns. Indeed, our achievements did not come easily.

Globally, the economic recovery was sluggish. Geopolitical conflicts became more acute, protectionism and unilateralism were on the rise, and the external environment exerted a more adverse impact on China’s development.

Domestically, owing to the impact of a three-year Covid-19 pandemic, many difficulties facing our economic recovery and development had yet to be resolved. While deep-seated, long-standing issues became more pronounced, many new developments and problems emerged. A drop in external demand coincided with a lack of domestic demand, and both cyclical and structural issues arose. Risks and potential dangers in real estate, local government debt, and small and medium financial institutions were acute in some areas. Some places were hit hard by natural disasters, such as floods, typhoons, and earthquakes. Under these circumstances, we faced considerably more dilemmas in making policy decisions and doing our work.

However, thanks to the concerted efforts of the entire nation, we accomplished the year’s development goals and embraced positive changes on many fronts. In particular, we acquired a deeper understanding of the laws governing economic work in the new era and gained valuable experience in overcoming major difficulties. All this demonstrates that under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, the Chinese people have the courage, vision, and strength to meet any challenge and overcome any obstacle. There is no doubt that in pursuing development, China will continue to surge ahead, cleave mighty waves, and advance toward a great future.

Key numbers for the year of 2023

-- China’s gross domestic product (GDP) surpassed 126 trillion yuan, an increase of 5.2 percent.

-- A total of 12.44 million urban jobs were added, and the average surveyed urban unemployment rate stood at 5.2 percent.

-- The consumer price index (CPI) rose by 0.2 percent.

-- China accounted for over 60 percent of global electric vehicle output and sales.

-- The volume of contracted technology transactions grew by 28.6 percent.

-- Grain output reached a record of 695 million metric tons.

-- Per capita disposable income of residents increased by 6.1 percent.

-- Per capita income in rural areas that have been lifted out of poverty growing by 8.4 percent.

Difficulties and challenges confronting China

While recognizing our achievements, we are keenly aware of problems and challenges that confront us.

Global economic growth lacks steam, and regional hotspot issues keep erupting. This has made China’s external environment more complex, severe, and uncertain.

The foundation for China’s sustained economic recovery and growth is not solid enough, as evidenced by a lack of effective demand, overcapacity in some industries, low public expectations, and many lingering risks and hidden dangers. Furthermore, there are blockages in domestic economic flows, and the global economy is affected by disruptions.

Some small and medium-sized enterprises (SMEs) face difficulties in their operations. We are confronted with both pressure on over all job creation and structural employment problems, and there are still many weak links in public services. Some primary-level governments are facing fiscal difficulties.

China’s capacity for scientific and technological innovation needs to be further improved. There are still many challenging issues concerning reforms in key areas that need to be addressed. We have a long way to go in protecting and improving the environment, and weak links in workplace safety should not be ignored.

There is also room for improvement in the work of the government. Pointless formalities and bureaucratism remain acute, and some reform and development steps have yet to be fully implemented. Some officials lack the readiness to get down to work, evade responsibilities, and do their work in a perfunctory way. Corruption remains a common problem in some sectors.

But you can rest assured that we will face these problems and challenges head-on, make every effort to deliver, and do our utmost to live up to the expectations and trust of the people.

The main targets for development this year are projected as follows:

• GDP growth of around 5 percent

• over 12 million new urban jobs

• surveyed urban unemployment rate of around 5.5 percent

• CPI increase of around 3 percent

• growth in personal income in step with economic growth

• a basic equilibrium in the balance of payments

• grain output of over 650 million metric tons

• a drop of around 2.5 percent in energy consumption per unit of GDP

• continued improvements in the environment

On GDP growth

In setting these targets, we considered evolving dynamics at home and abroad and other relevant factors as well as what is needed and what is possible. In setting the growth rate at around 5 percent, we have taken into account the need to boost employment and incomes and prevent and defuse risks. This growth rate is well aligned with the objectives of the 14th Five-Year Plan and the goal of basically realizing modernization. It also takes account of the potential for growth and the conditions supporting growth and reflects the requirement to pursue progress and strive to deliver. Achieving this year’s targets will not be easy, so we need to maintain policy focus, work harder, and mobilize the concerted efforts of all sides.

Policy guidance

We should adhere to the principles of pursuing progress while ensuring stability, promoting stability through progress, and establishing the new before abolishing the old.

Stability is of overall importance, as it is the basis for everything we do. All localities and government departments should adopt more policies that are conducive to keeping expectations, economic growth, and employment stable. They should take good care in formulating measures that could be contractionary or inhibitive in nature and overhaul or abolish policies and regulations that hinder high-quality development.

Making progress is our goal, and it is also what motivates us. Therefore, we should proactively establish what is needed and resolutely abolish what is obsolete once the new is in place. In particular, we must push ahead with transforming the growth model, making structural adjustments, improving quality, and enhancing performance.

We should intensify counter- and cross-cyclical adjustments through macro policies, continue to implement a proactive fiscal policy and a prudent monetary policy, and strengthen coordination between policy instruments while developing new ones.

Appropriately enhance the intensity of proactive fiscal policy and improve its quality and effectiveness

We should take into account both development needs and fiscal sustainability, leverage fiscal policy space, and improve the policy toolkit. We have set the deficit-to-GDP ratio for this year at 3 percent and the government deficit at 4.06 trillion yuan, an increase of 180 billion yuan over the 2023 budget figure. It is projected that fiscal revenue will continue to grow in 2024 and we will also have funds transferred from other sources; on this basis, general public expenditures in the government budget are projected to reach 28.5 trillion yuan, an increase of 1.1 trillion yuan over last year. This year, 3.9 trillion yuan of special-purpose bonds for local governments will be issued, an increase of 100 billion yuan over last year.

Implement a prudent monetary policy in a flexible, appropriate, targeted, and effective way

We should maintain adequate liquidity at a proper level and see that aggregate financing and money supply stay in step with the projected economic growth and CPI increase. We should adjust both the monetary aggregate and structure, put idle funds to good use, and step up support for major strategies, key areas, and weak links. We should work for a steady decline in overall financing costs. We should improve the monetary policy transmission mechanism to prevent funds from sitting idle or simply circulating within the financial sector. The underlying stability of the capital market should be enhanced.

The RMB exchange rate should remain generally stable at an adaptive, balanced level. We should boost the development of technology finance, green finance, inclusive finance, pension finance, and digital finance. To better meet the fundraising needs of micro, small, and medium enterprises, supporting measures such as credit enhancement, risk sharing, and information sharing should be improved.

Enhance the consistency of macro policy orientation

To promote overall national development, we should strengthen coordination between fiscal, monetary, employment, industrial, regional, scientific and technological, and environmental policies and include non-economic policies in the evaluation of the consistency of macro policy orientation. Policy coordination should be enhanced so that all policies are well-aligned and form synergy.

In policymaking, all localities and government departments should heed and draw on the propositions and views of all parties concerned. They should pay attention to the views of market entities and address their concerns when formulating enterprise-related policies.

In policy implementation, we should strengthen coordination and interplay between policies to see that together they deliver greater outcomes. We should avoid focusing on one single policy to the detriment of others or letting one policy impede another.

Major tasks for 2024 (新质生产力 “new quality productive forces” will be the new buzzword in policy documents)

1. Striving to modernize the industrial system and developing new quality productive forces at a faster pace

2. Invigorating China through science and education and consolidating the foundations for high-quality development

3. Expanding domestic demand and promoting sound economic flows

4. Continuing to deepen reform and boosting internal momentum for development

5. Pursuing higher-standard opening up and promoting mutual benefits

6. Ensuring both development and security and effectively preventing and defusing risks in key areas

7. Making sustained efforts to deliver in work relating to agriculture, rural areas, and rural residents and taking solid steps to advance rural revitalization

8. Promoting integrated development between urban and rural areas, advancing coordinated development between regions, and optimizing regional economic layout

9. Enhancing ecological conservation and promoting green and low-carbon development

10. Ensuring and improving the people’s wellbeing and promoting better and new ways of conducting social governance

On military

Last year, we made new achievements and progress in national defense and military development, and our people’s armed forces fulfilled their missions and tasks with impressive results. This year, we will continue to implement Xi Jinping’s thinking on strengthening the military and the military strategy for the new era. We will remain committed to the Party’s absolute leadership over the people’s armed forces, thoroughly implement the system of ultimate responsibility resting with the chairman of the Central Military Commission, and take critical steps to meet the centenary goal of the People’s Liberation Army.

The armed forces will strengthen all-around military training and combat readiness, make well-coordinated efforts to improve military preparedness, and devote great energy to training under combat conditions, so as to firmly safeguard China’s national sovereignty, security, and development interests.

We will modernize the military governance system, advance military development as outlined in the 14th Five-Year Plan, and speed up the implementation of major defense-related projects.

We will consolidate and enhance integration of national strategies and strategic capabilities, refine the system and layout of defense-related science, technology, and industries, raise public awareness concerning national defense, and strengthen national defense mobilization and readiness of reserve forces.

We in governments at all levels will provide strong support to the development of national defense and the armed forces and strengthen mutual support between civilian sectors and the military, so as to consolidate the unity between the military and the government and between the military and the people.

On Taiwan

We will implement our Party’s overall policy for the new era on resolving the Taiwan question, stay committed to the one-China principle and the 1992 Consensus, and resolutely oppose separatist activities aimed at “Taiwan independence” and external interference.

We will promote the peaceful development of cross-Strait relations, be firm in advancing the cause of China’s reunification, and uphold the fundamental interests of the Chinese nation. By advancing integrated cross-Strait development, we will improve the wellbeing of Chinese people on both sides so that together, we can realize the glorious cause of national rejuvenation.

On foreign policy

We will stay committed to an independent foreign policy of peace and to peaceful development. We will remain firm in pursuing a strategy of opening up for mutual benefit. We call for an equal and orderly multipolar world and universally beneficial and inclusive economic globalization, and we are committed to promoting a new type of international relations. We will remain firm in opposing all hegemonic, high-handed, and bullying acts and upholding international fairness and justice.

China is ready to pursue the Global Development Initiative, the Global Security Initiative, and the Global Civilization Initiative with other members of the international community so as to promote the shared values of humanity, reform the global governance system, and build a human community with a shared future

---

---