Beijing forecasts 5% growth in 2024, one of the weakest in decades

China announced Tuesday to aim for growth of around 5% in 2024, one of its most modest goals in decades, as the world's second-largest economy struggles to keep pace. relaunching since the Covid years.

The figure was made official by Premier Li Qiang during a speech at the annual session of the Chinese Parliament in Beijing, which opened at 9:00 a.m. (01:00 GMT).

This objective is a far cry from the double-digit growth recorded in the 1990s and 2000s.

Its budget military, the second largest in the world, even if it remains more than three times lower than that of the United States, will increase by 7.2%: Beijing plans to spend 1,665.5 billion yuan (231.4 billion dollars) for his defense.

Last year, the annual political high mass was devoted to the granting of an unprecedented third term to President Xi Jinping, in power since 2012.

This year, all attention is focused on the difficulties of the world's second largest economy, which is struggling to restart after its three years of closure linked to Covid.

2023: China experiences weakest growth in three decades © AFP – Sabrina BLANCHARD, Gal ROMA

In 2023, it recorded one of its weakest growth (5.2%) since the 1990s, penalized by a real estate crisis, record unemployment among young people and the global slowdown which affects demand for products. Chinese.

Security and surveillance have been reinforced in the streets of the capital for the arrival of thousands of parliamentarians participating in the “Two Sessions” – that of Parliament proper, which began on Tuesday, and that of the consultative assembly, which began on Monday.

General view of the opening of the annual session of the Chinese Parliament in Beijing on March 5, 2024 © AFP – JADE GAO

The annual session of Parliament, a key event in the national political calendar, is held until March 11. This session is supposed to display the unity of the country, with the almost unanimous votes of nearly 3,000 representatives.

– “Continue progress” –

Despite the economic gloom, analysts do not expect a major recovery plan.

All major decisions were made weeks before, in closed meetings of the Chinese Communist Party, far from media attention.

But the themes discussed and the tone of the speeches makes it possible to know the main priorities of the leaders, analysts believe.

“The Chinese Parliament is neither obsolete nor without interest”, underlines Nis Grunberg, from the Merics Institute based in Germany.

“It is an important platform for leaders to communicate their priorities.”

Chinese Premier Li Qiang delivers a speech at the opening of the annual session of the Chinese Parliament, in Beijing on March 5, 2024 © AFP – GREG BAKER

In recent years, the Chinese authorities have ruled out the idea of ​​a large-scale recovery plan, fearing that it could put public finances in difficulty.

Analysts see no reason for this to change.

In its activity report published on Tuesday, the government only promised to “pursue progress and guarantee stability” of the economy in 2024, also announcing the reduction of customs taxes on imports of certain technological products.

“We will work to expand our network of free trade zones and help local governments and businesses open new avenues for foreign trade by making better use of all free trade agreements,” says the report.

– Opposition to the independence of Taiwan –

Between reviving the economy and strengthening security, the choice is quickly made, according to analysts.

Security personnel march in step ahead of the opening ceremony of the Chinese People's Political Consultative Conference on March 4, 2024 in Beijing. © AFP – WANG Zhao

Beijing last year vastly expanded its definition of what constitutes espionage and raided several foreign consulting, auditing and research companies.

Shortly before this parliamentary session, the notion of state secrecy was also broadened, “a clear signal of the importance of security on the power agenda this year”, according to Diana Choyleva , chief economist at Enodo Economics.

The political meeting should therefore serve to “strengthen national security measures on all fronts”, predicts Ho-fung Hung, professor in political economy at the American Johns Hopkins University.

The constant increase in the Chinese military budget takes place in a context of corruption in the army and persistent tensions around Taiwan and in the South China Sea.

“We vigorously oppose separatist activities aimed at Taiwan's independence and external interference”, recalled Tuesday government activity report, published two months after the election in Taiwan of Lai Ching-te, president who considers the island to be de facto independent.

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