Chinese President Xi Speaks on Economic Impact of Coronavirus
After China eliminated its GDP growth target for the year in the wake of the coronavirus crisis, President Xi Jinping stated that his country could have set a growth target of 6% for the current year if the pandemic hadn’t impacted China and the rest of the world. Xi’s GDP growth estimate is in line with what economists polled by Reuters had forecast late last year.
Xi made these comments while addressing a parliamentary group over the weekend, adding, “If the epidemic hadn’t happened, under general circumstances, the GDP growth target would be set around 6%. If we rigidly set one (GDP target), then the focus will be on strong stimulus and to hit the growth rate, which is not in line with the purpose of our economic and social development.”
However, as a result of the pandemic, the Chinese government has had to roll out stimulus measures worth more than 4% of the GDP to prop up the economy instead. The Chinese Premier had unveiled the yearly work report late last week in which the government has committed to making its fiscal policy more proactive and increase the flexibility of its monetary policy, even as it tries to bolster employment levels and domestic consumption in the aftermath of the pandemic.
Xi also spoke about the inevitability of a recession in the global economy driven by the pandemic but added that he was unsure of the extent of impact on the Chinese economy so far. China saw its GDP contract in Q1 2020 as a result of the coronavirus crisis and the enforced lockdowns.
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