‘China struggling to meet 7% growth target’

China is struggling to meet its 7 per cent growth rate target this year, Finance Minister Lou Jiwei said today, citing slowdown of revenue growth.

The central treasury received 2.95 trillion yuan (about $475 billion) from January to May, an year-on-year increase of 2 per cent, Lou said, while briefing lawmakers on a State Council report on the final accounts for 2014.

The increase is far below the previously budgeted growth rate of 5 per cent.

Total national fiscal revenue reached 6.43 trillion yuan in the same period of time, up 3. 1 per cent year-on-year.

Lou attributed the “receding” fiscal revenue to an unfavourable macro economic status quo — the widely touted “new normal’’.

The economy grew 7.4 per cent in 2014, the weakest annual expansion in 24 years. This year’s growth target is set at approximately 7 per cent.

The government has resorted to reforms in hopes of stronger growth and structural optimisation, Lou said.

“With the new growth engines still in the making, external demand contracting with internal contradictions aggregating, there has been considerable downward pressure on the economy,” he was quoted as saying by the state-run Xinhua news agency.

That, among other factors, have left the central government under “considerable pressure to meet its fiscal revenue target ...for the rest of the year’’, Lou said.

The government, meanwhile, has undertaken a series to measures to steady growth and to restructure its economy.

Some of these measures “have already worked, or are currently working,” Lou said.

The government will stick to the strategic development blueprint of the ‘Four Comprehensives’ and focus on achieving the dual objectives of “maintaining medium-high growth and moving toward medium-high development’’, he said.

The central cabinet report was submitted to the Standing Committee of the National People’s Congress (NPC) at its ongoing bi-monthly session.

COMMENT NOW