Thousands of masked delegates gather at National People's Congress

Thousands of masked delegates gather at China’s National People’s Congress to hear Xi DROP economic targets for first time in 20 years as coronavirus hammers the economy and Beijing faces global backlash

Thousands of party representatives wearing face masks attended China’s parliamentary meeting of the year
Chinese President Xi Jinping scrapped the country’s annual GDP target for the first time in last two decades
The decision comes as the world’s second largest economy has been rocked by the coronavirus pandemic
Beijing has been criticised by world leaders for its handling of the health crisis and accused of covering up
Here’s how to help people impacted by Covid-19

Thousands of party representatives wearing face masks have gathered at China’s annual parliamentary meeting as President Xi scraps the country’s annual growth target.

The decision comes as the world’s second largest economy is stalled due to the coronavirus pandemic while Beijing faces anger from other countries about its handling of the outbreak.

Thousands of party representatives wearing face masks have gathered at China’s annual parliamentary meeting as President Xi scraps the country’s annual growth target. Pictured, a group of hostesses serve tea to delegates during the opening session of the Chinese People’s Political Consultative Conference (CPPCC) at the Great Hall of the People in Beijing on May 21

The decision comes as the world’s second largest economy is stalled due to the coronavirus pandemic while Beijing faces backfire from other countries about its handling of the outbreak. Delegates wearing face masks attend the opening meeting of the third session of the 13th National People’s Congress (NPC) at the Great Hall of the People on May 22

The announcement was delivered by Li Keqiang, China’s Premier, as he pledged more government spending following the COVID-19 crisis, setting a sombre tone to this year’s meeting at China’s National People’s Congress. Chinese President Xi Jinping is pictured attending the opening of the National People’s Congress at the Great Hall of the People on May 22

The omission from Premier Li Keqiang’s work report marks the first time China has not set a target for gross domestic product (GDP) since the government began publishing such goals in 1990.

China’s economy shrank 6.8% in the first quarter, the first contraction in decades, hit by the outbreak of the new coronavirus, which started in the central Chinese city of Wuhan.

‘We have not set a specific target for economic growth for the year, mainly because the global epidemic situation and economic and trade situation are very uncertain, and China’s development is facing some unpredictable factors,’ Li said at the start of parliament.

Domestic consumption, investment and exports are falling, and the pressure on employment is rising significantly, while financial risks are mounting, he warned.

The announcement was delivered by Li Keqiang (pictured), China’s Premier, as he pledged more government spending following the COVID-19 crisis, setting a sombre tone to this year’s meeting at China’s National People’s Congress

China’s economy shrank 6.8% in the first quarter, the first contraction in decades, hit by the outbreak of the new coronavirus, which started in the central Chinese city of Wuhan. Pictured, Chinese leaders and delegates wearing face masks bow their heads during the opening session of China’s National People’s Congress at the Great Hall of the People in Beijing on May 22

Thousands of party representatives wearing face masks have gathered at China’s annual parliamentary meeting as President Xi scraps the country’s annual growth target. Groups of party delegates are seen gathering before the start of the opening session of China’s National People’s Congress (NPC) at the Great Hall of the People in the capital city Beijing on May 22

China has set a target to create over 9 million urban jobs this year, according to Li’s report, down from a goal of at least 11 million in 2019 and the lowest since 2013.

Ahead of the National People’s Congress, the week-long meeting of the largely rubber-stamp parliament, China’s top leaders have promised to boost stimulus to bolster the economy amid rising worries job losses could threaten social stability.

Beijing is also planning security legislation for Hong Kong, which Li said will provide a ‘sound’ legal system and enforcement mechanisms but which critics say could curb autonomy in the city.

The move drew warnings from the United States, falls on Asian stock markets and calls among Hong Kong activists for protests in the former British colony.

China has set a target to create over 9 million urban jobs this year, according to Li’s report, down from a goal of at least 11 million in 2019 and the lowest since 2013. Delegates wearing face masks leave after the opening of the meeting yesterday

Thousands of party representatives wearing face masks have gathered at China’s annual parliamentary meeting as President Xi scraps the country’s annual growth target. Delegates applaud as Chinese President Xi Jinping arrives for the opening session of China’s National People’s Congress (NPC) at the Great Hall of the People in Beijing on May 22

China is targeting a 2020 budget deficit of at least 3.6% of GDP, above last year’s 2.8%, and fixed the quota on local-government special bond issuance at 3.75 trillion yuan (£431 billion), up from 2.15 trillion yuan, according to Li. Chinese President Xi Jinping (C) watches as staff wearing face masks refill cups at the opening session of National People’s Congress

The government will issue 1 trillion yuan in special treasury bonds this year, the first such issuance. It will transfer 2 trillion yuan raised from the bigger 2020 budget deficit and special anti-coronavirus treasury bonds to local governments, Li said.

Local government bonds could be used to fund infrastructure projects, while special treasury bonds could be used to support firms and regions hit by the outbreak.

The fiscal stimulus in Li’s report is equivalent to about 4.1% of China’s GDP, according to Reuters calculations based on the fiscal measures announced.

‘The annual budget points to fiscal stimulus this year at least on par with that following the global financial crisis,’ Julian Evans-Pritchard, senior China economist at Capital Economics, wrote in a note.

But Nie Wen, economist at Shanghai-based Hwabao Trust, said Li’s report indicates China will ‘not resort to mass stimulus that some market players have been betting on.’

Nie expects GDP growth to slow sharply this year to around 2% or 3% from last year’s 6.1%.

This picture taken Thursday shows thousands of delegates attend the opening of the third plenary session of the 13th National Committee of the Chinese People’s Political Consultative Conference (CPPCC) at the Great Hall of the People in Beijing city

Thousands of party representatives wearing face masks have gathered at China’s annual parliamentary meeting as President Xi scraps the country’s annual growth target. Delegates are pictured applauding during the opening session of China’s National People’s Congress which took place on May 21 at the Great Hall of the People in Beijing

In line with the slower economy, China will raise defence spending by 6.6% this year, the slowest in three decades, while the budget for environmental protection will increase a modest 4%. Delegates are pictured applauding during the opening session of China’s National People’s Congress which took place on May 21 at the Great Hall of the People in Beijing

‘This year’s economic growth needs to reach around 3% to create 9 million new urban jobs,’ Nie said, adding that the size of the fiscal stimulus announced by Li is about 4 trillion yuan.

In line with the slower economy, China will raise defence spending by 6.6% this year, the slowest in three decades, while the budget for environmental protection will increase a modest 4%.

Monetary policy will be more flexible, Li said, adding that growth in M2 – a broad gauge of money supply – and total social financing will be significantly higher this year.

The People’s Bank of China (PBOC) will guide its benchmark lending rate lower, he said.

The decision comes as the world’s second largest economy is stalled due to the coronavirus pandemic while Beijing faces backfire from other countries about its handling of the outbreak. Chinese President Xi Jinping (pictured left) and Premier Li Keqiang (pictured right) arrive for the opening session of the National People’s Congress (NPC) in Beijing on May 22

The announcement was delivered by Li Keqiang, China’s Premier, as he pledged more government spending following the COVID-19 crisis, setting a sombre tone to this year’s meeting at China’s National People’s Congress. Military delegates are pictured today leaving after the opening session of China’s National People’s Congress (NPC) at the Great Hall of the People

In line with the slower economy, China will raise defence spending by 6.6% this year, the slowest in three decades, while the budget for environmental protection will increase a modest 4%. Pictured, a group of journalists wearing face masks report the opening session of China’s National People’s Congress (NPC) at the Great Hall of the People in Beijing on May 22

The central bank has cut the Loan Prime Rate (LPR) by 46 basis points since August 2019, when it replaced the previous benchmark lending rate. The one-year LPR rate is now 3.85%.

The PBOC has cut reserve requirement ratios 10 times since early 2018, including three cuts this year.

Small and midsize companies can delay paying loans and interest by a further nine months, through March 2021, and lending to SMEs by big commercial banks should grow more than 40%, Li said.

The tax and fee burden shouldered by companies will be cut by 2.5 trillion yuan (£288) this year, Li said.

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