China sets growth target of 7.5% for 2014

After years of blistering growth rates, China has seen its rate of expansion slide after a slowdown domestically and in key markets.

In 2013, the country grew at a pace of 7.7%, about the same as in 2012.

Recent manufacturing data has also indicated a slowdown in activity in the world’s second largest economy.

The latest targets were announced by Premier Li Keqiang in his first appearance at China’s annual parliamentary session, the National People’s Congress (NPC).

China describes the NPC as the country’s “supreme organ of state power”.

But in practice, it is generally considered a rubber stamping body for the ruling Communist Party.

Property bubble targeted

The growth and inflation targets were widely expected.

“Officially, they are conservative and the figures are basically in line with our expectation,” said Paul Tang, chief economist with the Bank of East Asia in Hong Kong.

“Slower economic growth is already expected for this year. Tightening of fixed-asset investment and lending are seen to remain as the major focuses.”

Premier Li said the government would work towards increasing personal incomes, and also promised to address the property market.

Property purchases have been a popular investment choice in China – a trend that kept prices rising in 2013 and raised fears of a property bubble.

China’s central bank acted late last year by tightening monetary conditions and reining in excessive lending growth.

The meeting of around 3,000 legislators from delegations across China is set to run for 10 days.

 

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