China sets robust economic growth with high quality

Chinese Premier Li Keqiang delivers a government work report at the opening meeting of the first session of the 13th National People's Congress at the Great Hall of the People in Beijing, capital of China, March 5, 2018. [Photo: Xinhua]

Chinese leaders have set their annual economic growth targets, as well as plans for the development of high-tech to start out this year's NPC legislative session.

Addressing the opening of the National People's Congress on Monday, Chinese Premier Li Keqiang has suggested China has achieved sustainable growth amid domestic downward pressure and a world economic recovery the Chinese government sees as "anemic" in the past few years.

"Over the past five years, economic strength has reached a new high. China's gross domestic product has risen from 54 trillion to 82.7 trillion yuan, registering average annual growth of 7.1 percent; and its share in the global economy has grown to roughly 15 percent, up from 11.4 percent. China's contribution to global growth has exceeded 30 percent. More than 66 million new urban jobs have been added, and our country, with its population of over 1.3 billion, has achieved relatively full employment." 

While delivering the annual government work report, Li Keqiang has announced a target for economic growth this year at around 6.5 percent.

This is the same initial target set by the government last year, which was exceeded.

Senior officials are suggesting the projected growth rate reflects a priority on not over-emphasizing the pace of economic growth, but rather the improvements in the quality of development.

The report does say the Chinese government expects a continued recovery of the global economy, but also notes policy changes in major economies and their spillover effects could create uncertainty.

It also notes that mounting protectionism also adds to the risk factors.

Li Keqiang says that despite these challenges, the Chinese government expects to maintain sustainable, high quality growth.

"In fact it's always been the case that China's achievements in development have been made whilst overcoming difficulties. Today, China's material and technological foundations are much stronger; its industrial system is complete, its market is vast, its human resources are abundant, and its entrepreneurs and innovators are dynamic. We enjoy composite advantages, and all this means that we have the ability and the conditions to achieve higher quality, more efficient, fairer, and more sustainable development."

To help maintain growth, the Chinese government has been nurturing entrepreneurship and businesses growth by adjusting the tax system.

This includes the replacement of the business tax with value added tax to all sectors of the economy. 

This has led to an overall tax savings in China of some 2 trillion yuan.

At the same time, Li Keqiang has announced plans to cut taxes for businesses and individuals by more than 800 billion yuan, or about 125 billion U.S. dollars, this year.

"China will prioritize lowering rates in manufacturing and transportation, and raise the threshold for annual sales revenue for small-scale taxpayers. Far greater numbers of small low-profit businesses will see their income tax halved. A policy of uniform corporate income tax exemption on the overseas earnings of Chinese businesses will be put into implementation. More logistics companies will enjoy preferential tax treatment on their use of land for storage facilities."

The report contends that a priority on higher-quality growth will help in further opening up China's market.

This includes granting complete access to foreign investment in the general manufacturing sector this year. 

Li Keqiang's report also promises more foreign opportunties in the telecommunications, medical services, education, elderly care and new energy vehicle sectors

The report also notes that to encourage imports, plans are being worked on for the creation of the first-ever China International Import Expo this year.

Chinese authorities also plan to lower import tariffs on products including automobiles and certian daily consumer goods as well.