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SCMP Reporters

This story has been made freely available as a public service to our readers. Please consider supporting SCMP’s journalism by subscribing in our spring flash sale.
China’s top legislature, the National People’s Congress (NPC), opens its annual meeting on Tuesday.
Premier Li Qiang will deliver his first government work report at the meeting, offering a glimpse into the central government’s economic goals and foreign policy as well as its approach towards social issues, Hong Kong affairs and Taiwan.
This year’s gathering comes as concerns about China’s economy intensify following market slides and faltering growth figures last year.
Follow our live coverage of the NPC opening as it unfolds.


Reporting by Jane Cai, Vanessa Cai, Kinling Lo, Josephine Ma, Mia Nulimaimaiti, Dewey Sim, Amber Wang, Hayley Wong, Kawala Xie, Luna Sun, Wendy Wu and Zhao Ziwen


As it happened: China’s ‘two sessions’ 2024 – Premier Li Qiang sets GDP target of around 5% for the year

Chinese Premier Li Qiang delivers his work report at the Great Hall of the People in Beijing. Photo: Reuters

News

China

Politics

Premier unveiled this year’s economic targets as he delivered his first work report amid growing concerns about the state of the economy
Other policy pledges include removing barriers to investment and boosting military preparedness as spending on the military increases


Premier unveiled this year’s economic targets as he delivered his first work report amid growing concerns about the state of the economy.


Two Sessions 2024 (Lianghui)

China economy

China GDP

China leadership

Communist Party politics

National People's Congress (NPC)

Live

Nearly 3,000 NPC deputies and over 2,100 members of the Chinese People’s Political Consultative Conference (CPPCC) are gathering in Beijing for the two sessions, China’s annual parliamentary meetings.
After four years of strict Covid-19 controls, this year’s attendees may move around without masks. However, they must still perform a pre-event nasal swab test before attending meetings at the Great Hall of the People.


Post-pandemic protocols

This year’s NPC session will be condensed to seven days. Before Covid-19, the meetings typically stretched around two weeks.
Short sessions are expected to become the new norm. Last year’s session – the first after China’s pandemic restrictions were lifted – lasted 8½ days.


Shorter sessions


Security measures have been stepped up in China’s capital city for the two sessions.
The use of drones is banned in Beijing from March 1 to 12, and several roads will be closed temporarily, according to a notice issued last week.
Police have increased ID checks in the downtown area. Beijing authorities also say they will increase security checks for inbound parcels, letters and railway passengers during the annual parliamentary sessions.


Tight security

More than 3,000 journalists are registered to cover the two sessions, including over 1,000 from foreign, Hong Kong and Macau media, according to official data.
In a rare move that breaks three decades of tradition, Premier Li Qiang will not meet the press after the annual session of China’s top legislature concludes next Monday.




Breaking tradition

It’s a rainy morning in Beijing today. Here’s the setting outside the Great Hall of the People in Beijing.

And the view from the inside a little earlier.



A view from Beijing

China observers are hoping Li’s work report will shed light on how Beijing plans to balance security and economic development as they wait for President Xi Jinping to call a third plenum of the Communist Party’s Central Committee.
The third plenum is typically held in October or November following the party congress, but a date is yet to be announced for the meeting.
It is arguably the most important of the seven plenary sessions held during the Central Committee’s five-year cycle as economic reforms have historically been approved at the meeting.


Delayed third plenum

President Xi Jinping and other senior officials take their seats. The premier’s speech will soon begin.



Xi takes his seat

Premier Li Qiang begins his speech by paying tribute to President Xi Jinping for leading the country, withstanding external pressure and overcoming internal difficulties.
China successfully fulfilled economic development tasks when facing an “abnormally complicated international environment” last year, Li says.




Li starts to speak

Li applauds China’s “high-quality development” in the past year, saying major national industries have made progress.
He gives the example of China’s narrowbody C919 passenger jet going into commercial operation and says China’s car manufacturing industry now accounts for 60 per cent of the global market.


Industries making progress, says Li

Li admits the economy has been facing some problems, saying the negative impact from the external environment has been increasing.
He says new problems and new situations came one after another on top of China’s existing structural economic problems, creating many policy dilemmas last year.
“We have faced multiple challenges in the past year, our achievements were hard-earned. Looking at the global environment, external factors have negatively affected our country’s development. Domestically, after three years of the pandemic, economic recovery has been difficult. Accumulated and deep-rooted problems have been apparent,” he says.


Admits difficulties

Li thanks Xi for his diplomatic and economic leadership, saying we “owe our development of last year to the efforts of Xi Jinping” and praises his foreign visits.
He also praises other sectors of society for their efforts and adds a special mention for “our fellow countryman in Hong Kong and Macau, Taiwan and overseas”, winning a round of applause for delegates.




More praise for Xi

Li praises the country’s policy accomplishments. He says China has stepped up development in science, technology and industrialisation, and urban residents now make up 66.2 per cent of the population.
He adds that China has also made efforts to promote foreign investment, help private enterprises and support veterans and other groups in finding jobs.
Other policy achievements include handling the Covid-19 pandemic and natural disasters such as floods, protecting the environment and cutting carbon emissions, he says.


Policy achievements

Li unveils some key economic targets.
He says this year’s GDP target will be set at around 5 per cent while the urban jobless rate is set at around 5.5 per cent – creating around 12 million new jobs – and inflation at around 3 per cent.


GDP target

He starts to give some policy details, including plans to issue ultra-long-term special treasury bonds for several consecutive years starting from this year. These will be specifically used to fund major national strategies and the construction of security capabilities in key areas. The first issue will be 1 trillion yuan (US$139 billion).
He also promises to create a stable, transparent and predictable policy environment for enterprises and will put the focus on “communicating with the market”.


Special bonds

China will issue 3.9 trillion yuan (US$541 billion) in special government bonds, and the government will find solutions to meet local governments’ funding shortages, Li says.
He says the government will strictly control the budget and pledges to step up scrutiny of the use of government funds.
All levels of government should support economic development, he adds, and local governments should be “cautious” in introducing measures that have a cooling effect on the economy.



Bonds and budgets

Li promises to support young talent in the hi-tech sector and says the country must move more quickly to boost self-reliance in this area.
He goes on to say a major task for the government this year will be upgrading the manufacturing, logistics and digital economy and stepping up technological education.


Tech promises

Another goal for this year is to expand domestic demand and promote steady growth in consumer spending, Li says.
He says the government will launch a year-long programme to boost consumption.



Boosting consumption

He says that government will also reform the tax and fiscal system, without elaborating further.
Li says that this year the government will also give support to industries such as intelligent and electric vehicles, as well as accelerating the development of new hydrogen energy, new materials and innovative pharmaceutical industries.
He also expects to see sectors such as bio-manufacturing and commercial aircraft manufacturing becoming new growth engines.


Tax reforms

Reaction is starting to come in to this year’s 5 per cent GDP target.
Gary Ng, a senior economist for Asia-Pacific thematic research at Natixis, says: “The growth target range shows Beijing acknowledges economic headwinds exist and wants to reserve flexibility in policymaking.
“To keep the economy afloat, it is unavoidable that the government will have to issue more debt to fund infrastructure spending, and monetary policy will be laxer. However, the policy direction and messages do not seem enough to revert the cautious sentiment in households, corporates and investors.”


What the GDP target means

Li promises to defuse risks in key economic areas.
Turning to the housing market, he says the government will offer more guarantees, such as the supply of subsidised housing.
There is also a promise to work on high-quality Belt and Road Initiative projects, including small projects to improve people’s well-being.


Defusing risk

Li wins applause as he promises to remove barriers and give wider access to private investors.
He says the government will make it easier for private investment to boost economic growth and vows to create an equal environment for the private sector.
He also promises to expand foreign trade – including cross-border e-commerce and imports of high-quality goods – and to loosen restrictions on foreign investment.


Private investment promises

China’s defence budget will increase by 7.2 per cent this year, the same increase as last year, according to the finance ministry’s budget report.
Spending will grow to 1.67 trillion yuan (around US$232 billion), according to a draft budget released on Tuesday.



Military spending going up

Li vows to open up more sectors to foreign investment, such as telecommunications and medical services, and to “completely scrap” the threshold for foreign investment in the manufacturing sector.
China will address barriers faced by foreign investors, such as “cross-border data flow” and the ability to participate in the government tendering processes, he says.
The country will also make it easier for foreigners to live, work and study in China, he says.
China’s free trade ports, such as the Hainan free trade zone, will be given more autonomy in opening up, he adds.


Foreign investors and residents

China sets a target of reducing energy consumption per unit of GDP by 2.5 per cent from last year. It will “prudently” push ahead with carbon neutrality, Li says.


Carbon neutrality

Li reiterates China’s goal of ensuring national food security to make sure the country’s food supply is “firmly in our own hands”.
China will work to improve grain and energy reserves to ensure the safety and stability of the supply chain.



Food security

He repeatedly pledges loyalty to Xi and says government officials should continue to fight corruption.
“We will carry forward the spirit of self-reform. We will stay focused on improving conduct, tightening discipline and fighting corruption,” he tells the hall.
“We will improve government performance across the board... we should also make sure all of our work keeps in line with the central party’s directions.”



Fighting corruption

Turning to defence, Li says the country will “comprehensively strengthen military training and combat readiness”, and “firmly safeguard national sovereignty, security, and development interests”.
He adds that “last year we made achievements in national defence” and says that this year there will be “critical steps to meet the century goals of the PLA [People’s Liberation Army] and speed up the implementation of defence projects”.


National security pledge

Job creation will be another goal, Li says, noting China will have 11.7 million fresh university graduates this year.
“We must do more to promote employment for young people and provide better guidance and services to help them secure jobs or start businesses,” he says.



Job creation

Li says China is committed to an independent foreign policy of peace, the path of peaceful development and a “win-win” strategy of opening up.
He adds that China is committed to working with the international community to drive reform of the global governance system.


Peace pledge

He says the government will support Hong Kong and Macau to grow their economies and maintain long-term prosperity and stability.
The premier also says Beijing will ensure the two special administrative regions are ruled by patriots.



Hong Kong and Macau

Beijing will resolutely oppose “Taiwan independence” and external interference, Li says.
Beijing will promote the peaceful development of cross-strait relations and “unswervingly” advance the great cause of reunification, he adds.
“We will implement our party’s overall policy for the new era on resolving the Taiwan question.”
He says Beijing is committed to the one-China principle, sternly opposes separatists and upholds the fundamental interests of the Chinese nation.
Beijing will work with compatriots to realise national rejuvenation, he adds.


The ‘Taiwan question’

More reaction to the 5 per cent GDP target.
“Compared with last year, a growth target of around 5 per cent is still relatively ambitious, especially considering China’s tepid post-Covid recovery, property sector challenges, recurrent deflation, and dampened business and consumer confidence.
“This mark would signal a tactical focus on resuscitating confidence and spending,” according to Neil Thomas and Jing Qian from the Centre for China Analysis.


A ‘relatively ambitious’ target

Li wraps up his speech in around an hour. Relatively short for a work report, but around the same length as the late Li Keqiang’s speech last year.
Just to wrap things up, here are some of the key elements of the speech.

China aims to grow its GDP by “around 5 per cent” this year, the same as last year’s target. He also says China hopes to create more than 12 million new urban jobs, while keeping the urban unemployment rate at 5.5 per cent and inflation at 3 per cent.


He admits that the economic recovery will be difficult after the pandemic and says the external global environment has negatively affected the country’s development.


He says the People’s Liberation Army should “strengthen military training and preparedness across the board”. It has also been announced that the country’s military budget will increase by 7.2 per cent and be set at 1.66 trillion yuan ($231.4 billion).


He also promises to create a stable, transparent and predictable policy environment for enterprises and put the focus on “communicating with the market”. There are also pledges to defuse risk and offer more support for the housing market.


There are pledges to issue ultra-long-term special treasury bonds, starting with a 1 trillion yuan issue this year.


Li said China is committed to an independent foreign policy of peace, the path of peaceful development, and a win-win strategy of opening-up.


On Taiwan, the Premier says Beijing will uphold the one-China principle and resolutely fight against separatism and foreign interference.


He says the principle of “patriots administering Hong Kong” should be firmly enforced. He adds that Beijing will continue to support the economic development of Hong Kong and Macau, and develop the Greater Bay Area.

