China s parliament lines up stimulus to fend off tariff pressure

BEIJING - China kept its economic growth target for 2025 unchanged at roughly 5 per cent, committing more fiscal resources than in 2024 to mitigate the impact of rising US trade tariffs and global shifts that Premier Li Qiang said were “unseen in a century”.

The target, which confirms a December Reuters report, was unveiled by Mr Li at the opening of the annual meeting of the National People’s Congress (NPC),China’s rubber-stamp Parliament.

“Changes unseen in a century are unfolding across the world at a faster pace,” Mr Li said.

“An increasingly complex and severe external environment may exert a greater impact on China in areas such as trade, science and technology.”

An escalating trade war with US President Donald Trump’s administration is threatening to crimp China’s economic jewel – its sprawling industrial complex – at a time when persistently sluggish household demand and the unravelling of the debt-laden property sector are leaving the economy increasingly vulnerable.

Mr Trump has also dangled tariffs at a long list of countries, including some which would consider themselves staunch US allies, threatening a decades-old global trade order that Beijing has built its economic model around.

Pressure has been building on Chinese officials to introduce policies that put more money into consumers’ pockets to fend off deflationary woes and reduce the world’s second-largest economy’s reliance on exports and investment for growth.

Mr Alex Loo, foreign exchange and macro strategist at TD Securities, said the growth target seemed “like a tall task for policymakers, given the domestic challenges and external trade headwinds”.

Mr Li acknowledged “consumption, in particular, is sluggish”, noting “pressures on job creation and income growth”, and promised to “vigorously boost” household demand.

China aims for a budget deficit of around 4 per cent of gross domestic product (GDP) in 2025,