China to set economic growth target of 7 per cent for 2015
17 Oct 2014
China plans to set an economic growth target of about 7 per cent for 2015, tolerating the weakest expansion in a generation, as leaders tackled debt risks and imbalances, analysts polled by Bloomberg said.
According to 13 of 22 economists, China would aim for about 7 per cent growth next year, down from 7.5 per cent of this year.
According to 16 of the economists, the government should change its targeting policy, and according to nine, a range would be better while seven suggested targets be scrapped altogether in favour of projections or assumptions of growth, as provided by most other nations.
The government was holding off broad stimulus, with premier Li Keqiang expressing a preference for policy improvements even as People's Bank of China governor Zhou Xiaochuan vowed to stick with a prudent monetary stance.
Weighed down by a property slump, gross domestic product probably expanded 7.2 per cent in the third quarter, the slowest in over five years, economists forecast ahead of data due 21 October.
According to Yao Wei, a Paris-based China economist at Societe Generale SA, setting 7.5 per cent this year gave Beijing too little space for reform and de-leveraging.
He added, the recent talks from policy makers sent strong signals that the growth target was less important as long as the labour market remained stable.
Meanwhile, CNN Money's survey of economists suggested China's economy is likely to have clocked its worst quarter in over five years.
Gross domestic product was forecast to have expanded by 7.2 per cent in the third quarter, as against the same period last year, according to a median estimate of 15 economists.
That put economic growth at its slowest pace since the first quarter of 2009, and much short 7.5 per cent expansion in the second quarter.
According to economists surveyed full-year growth was expected to come in at 7.3 per cent, below the government's 7.5 per cent target, even as economic growth was forecast to dip further to 7 per cent in 2015.
The National Bureau of Statistics would announce official third quarter GDP figures on 21 October.
China's growth had averaged at around 10 per cent a year over the past three decades, as it entered and surged ahead in the league of the biggest economies.
However now, the pace of economic expansion was slowing -- China recorded GDP growth of 7.7 per cent in the last two years, versus 9.3 per cent in 2011 and 10.5 per cent in 2010.