Top planner upbeat about economic growth hopes

“The situation now is quite different from that in the late 1990s when loss-making State-owned enterprises underwent mergers and acquisitions”, Xu Shaoshi, minister of the National Development and Reform Commission, told a news conference on Wednesday.

China’s basic infrastructure investment growth increased 15 per cent past year, the official added.

In the past, actual growth often surpassed targets.

For 2015, the target was around 7% and actual growth is estimated at 6.9%. However, the low end of this year’s range seems to be a rather hard floor for China’s GDP growth.

The announcement marked the first time top leaders said they would aim for a growth range instead of a specific target since the the Eighth Five-Year Plan, which ended in 1995. For the past few years, the GDP growth target has been painted as flexible – a “soft” goal that gives China’s economic policymakers a bit more breathing room.

He Zhicheng, chief economist at Agricultural Bank of China, said many local governments have adopted a more flexible range for local economic growth this year.

Manufacturing data released Monday, for example, showed activity contracting at its fastest pace in 3 years.

China’s leaders – who previous year targeted growth of “about 7%” – are looking to transform the economy away from the investment and exports of the past to one more oriented towards domestic consumer demand.

Xu said governments at all levels would work to manage unemployment and prevent it from affecting social stability.

China has lot of policy tools to adopt that can help the economy to maintain a reasonable growth. The country also plans to take steps to curb excess industrial capacity and deal with unprofitable “zombie companies”, said Xu, head of the country’s top economic planner.