China will retain its GDP growth target of “around 6.5%” for 2018 according to policy sources speaking to Reuters.
According to several sources cited by Reuters the target was confirmed by senior leaders at China’s Central Economic Work Conference from December 18 – 20.
“The economic growth target will still be around 6.5% as they favour stability.”
The annual GDP target, which is scheduled for public release at the meeting of the Chinese legislature in March, has emerged as one of the world’s most closely watched policy announcements given the size of China’s economy and its importance to global economic growth.
In the wake of the 19th National Chinese Communist Party Congress speculation emerged that Beijing might dial down or even completely abandon its use of growth targets, given the absence of any mention of a target in the congressional report as well as Beijing’s emphasis on the theme of “quality growth.”
In October a senior CCP official also announced that Beijing would refrain from setting a decennial growth target in 2020.
Critics of the GDP targets say that they have contributed to a warping of the Chinese economy as well as the rapid accumulation of excessive debt levels, given that they incentivise local government leaders to expedite growth via credit-expansion.
China’s total debt in the second quarter of 2017 was equal to 255.9% of GDP according to figures from the Bank for International Settlements.
Analysts expect China to have achieved 6.8% growth in 2017 on the back of robust export demand, ahead of the 26-year low of 6.7% posted for the previous year.
Beijing previously set the goal of doubling 2010 GDP levels by 2020, which will require average annual growth of at least 6.3% until the end of the decade.