China will push to keep economic growth at “around 6.5%” in 2018, the same target set last year, policy sources told Reuters. If true, this would indicate that the government will only be willing to compromise on fast growth to a certain extent as it seeks to tackle the economy’s underlying debt risks.
The target of 6.5% was agreed by China’s top leaders at the agenda-setting Central Economic Work Conference in December, according to four sources with knowledge of the meeting. The goal will be unveiled officially during the annual parliament meeting in March.
The issue of China’s growth target has been of keen interest to analysts in recent months, as it is widely seen as a barometer of how far Xi Jinping’s government will be willing to go in order to achieve the “high-quality development” that China is now supposed to prioritize.
In the past, China has introduced stimulus policies in order to speed up growth and hit its annual GDP target, which has led to massive borrowing by state-owned enterprises and local governments. The country’s total debt reached 256% of GDP in the second quarter of 2017, according to Bank for International Settlements estimates.
“The economic growth target will still be around 6.5 percent as they favor stability,” one source told Reuters.