China’s leaders have expressed a calm outlook on the country’s economic recovery prospects after most COVID-19 restrictions on business activity ended last year.
Beijing has set the aim to raise the Gross Domestic Product (GDP) by 5 percent by 2023, with merely a slight augment in fiscal assistance.
The government’s conservative increase target of 6% by 2023 recognizes that China’s growth rate still faces headwinds. These include the impact of slower global economic growth on China’s exports and challenges related to the property sector and local government debt.
Indicating that long-term perspectives, including leverage constraints and financial stability, remain key elements of long-term policy, only a slight increase in fiscal government aid as well as more tailored monetary strategies have been implemented.
There are still several factors preventing the return and growth of consumption.
The impact of the pandemic has decreased, and only the recovery of retail sales can lead to growth.
While some increase in fiscal support is needed, it is important to increase such support “blindly.”
Retail sales rebounded 12.5% in 2021 after declining in 2020. In 2021, GDP increased by 8.2%.
An overall positive performance of the economy can help increase fiscal revenues and demand for workers. But the biggest pressure this year is on foreign trade.
Many analysts expect China’s exports to grow this year at best. This is due to reduced demand for Chinese products due to the slowdown in the EU and US economies.
Asia-Pacific shares were mixed as investors further analyzed China’s growth target set at its parliamentary sessions and awaited a week of economic statistics.
Shares of Hong Kong broadcaster TVB have seen an increase for the past four days after its announcement of a collaboration with Alibaba’s prominent Taobao to begin a combined e-commerce broadcast last week.
Its Hong Kong-traded shares were 21% higher on Monday after closing the session up 51.6%, representing a 90.79% year-to-date gain.
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