China has committed to investing billions of dollars in its struggling economy, which is now embroiled in a trade war with the United States, and has set an economic growth target of “around 5%” for this year.
As hundreds of delegates gather for the National People’s Congress, a rubber-stamp parliament that approves decisions already made behind closed doors, its leaders presented the plan. However, this year is more important than others, as the week-long event is widely scrutinized for hints about changes in Beijing’s policies.
Before the implementation of Donald Trump’s new 10% tax on Chinese imports on Tuesday, President Xi Jinping was already struggling with unemployment, a property crisis, and consistently low spending. This raises the overall US levy to 20% after the 10% tax applied in early February. Additionally, it impacts exports, which have been a rare area of economic growth for China.
Like last month, Beijing retaliated nearly instantly on Tuesday. It declared 10%–15% tariffs on specific US agricultural goods as part of its retaliation measures. This is crucial as China’s largest market for these products, including American corn, wheat, and soybeans.
China pledged to make domestic demand the “main engine and anchor” of its economic growth at the start of this week’s meeting, which is referred to as the Two Sessions. For the past two years, Beijing has reached its 5% objective, but growth was fueled by robust exports, creating a record trade surplus of almost trillions of dollars.
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