Govt to focus on top-quality development

China will give priority to high-quality development this year, setting its GDP growth target at above 6 percent, Premier Li Keqiang said on Friday, as the world's second-largest economy looks to cement its economic recovery from a year disrupted by COVID-19.

In the Government Work Report delivered at the opening of the fourth session of the 13th National People's Congress, Li underscored that the economic fundamentals that will sustain China's long-term growth remain unchanged despite potential risks and challenges this year.

"In setting this target, we have taken into account the recovery of economic activity. A target of over 6 percent will be well aligned with the annual goals of subsequent years in the 14th Five-Year Plan period (2021-25), and will help sustain healthy economic growth," he explained.

President Xi Jinping, who is also general secretary of the Communist Party of China Central Committee and chairman of the Central Military Commission, and other leaders also attended the session at the Great Hall of the People in Beijing.

With its GDP growing by 2.3 percent year-on-year in 2020, China was the world's only major economy to have avoided contraction. The government did not set a GDP growth target last year.

The 2021 target is below the forecast of some economists and international institutions, which expect China's growth could beat 8 percent this year.

The country will strive to create 11 million new jobs in urban areas and maintain the surveyed urban unemployment rate at around 5.5 percent, Li said, adding that the increase in the consumer price index, the main gauge of inflation, will be maintained at around 3 percent this year.

The central government plans to lower its fiscal deficit-to-GDP ratio to 3.2 percent this year from 3.6 percent in 2020 in a bid to maintain the consistency, stability and sustainability of macroeconomic policies, Li said.

The government will no longer issue a special bond for COVID-19 response as it did last year, Li said.

However, the premier stressed the need to ensure macroeconomic policies alleviate the difficulties of market entities and maintain necessary policy support for achieving this goal, acknowledging that smaller businesses and employed individuals are still struggling and pressure is mounting to stabilize the job market.

"We will avoid sharp turns in policy; instead, we should make adjustments and improvements based on new developments to reinforce the fundamentals of the economy," he said.

Setting the GDP growth target at over 6 percent is a result based on multiple considerations including the economic recovery forecast, the comparison base and balance of growth rate targets within the next few years, said Sun Guojun, a senior official at the State Council Research Office who participated in the drafting of the Government Work Report.

"Since the second quarter of last year, the Chinese economy has been steadily recovering, and it made a stronger rebound in the third and fourth quarters," Sun said. "It is expected that the Chinese economy will be able to maintain stable operations this year."

He explained that year-on-year GDP growth in the first quarter of 2021 is expected to be relatively high, due to the low comparison base.

The year-on-year GDP growth rates may get lower later in this year, but the quarter-to-quarter growth rates are likely to be relatively stable, Sun said.

In the report, Li also reiterated China's pledges to pursue high-standard opening-up and promote stable and improved performance in foreign trade and investment, with steps to accelerate China's free trade negotiations with Japan and South Korea. It will also actively consider joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, a trade pact.

The premier also spelled out targets outlined in the blueprint for social and economic development in the next five years, saying that the nation will strive to maintain its economic performance within a reasonable range and maintain the surveyed urban unemployment rate below 5.5 percent until 2025.

"Innovation remains at the heart of China's modernization drive. We will strengthen our science and technology to provide strategic support for China's development," he said.

He Lifeng, head of the National Development and Reform Commission, the country's top economic regulator, told reporters on Friday that a target of above 6 percent was set taking into account the uncertainties in the external environment, including the development of COVID-19 globally.

With the country's major economic indicators posting strong performance in January and February, He said China is full of confidence and resolve, and has what it takes to attain this year's goals and tasks.

With the country's services sector still struggling, especially accommodation, travel and tourism, the authorities are coming up with aid packages for businesses, he added.