China puts investors on edge by skipping formal GDP target
Chinese President Xi Jinping said he won’t let the world’s second-largest economy return to its days as a planned economy, pushing back against U.S. criticism that the nation has failed to deliver on promised reforms.
“We’ve come to the understanding that we should not ignore the blindness of the market, nor should we return to the old path of a planned economy,” Xi told political advisers gathered in Beijing for their annual legislative sessions on Saturday, according to the official Xinhua news agency. He reiterated the government’s stance that markets should play a “decisive role” in the economy.
The comments come as China faces mounting pushback from the Trump administration on a range of issues from trade to its handling of the coronavirus outbreak. The White House this week issued a broad critique of China’s economic and military policies in a report to Congress, including accusations of intellectual property theft and economic protectionism.
Xi said the virus has put considerable pressure on China’s economy, and the country should seek “development in a world that is increasingly unstable and uncertain” as he listed risks ahead including a deepening global recession, a significant drop in trade investment, financial market turmoil, reduced international interactions and rising geopolitical tensions.
Chinese lawmakers on Friday abandoned their usual practice of setting a numerical target for economic growth this year due to the turmoil caused by the virus, breaking with decades of Communist Party planning habits in an admission of the deep rupture that the disease has caused.
They’re also using the legislative meeting to pass a bill establishing “an enforcement mechanism for ensuring national security” for Hong Kong, prompting swift pushback from pro-democracy activists in the city and condemnation from American politicians.
Xi didn’t address the legislation in his speech, but stressed that China should “stand on the right side of history,” adhere to multilaterism and maintain an “open, cooperative” attitude despite rising protectionism.