Economist: GDP goal within grasp

China can realize its 2024 GDP growth target of around 5 percent, given its favorable conditions, greater efforts to boost industrial upgrade, technological innovation and sufficient policy tools, said a renowned economist.

Quan Heng, Party secretary of the Shanghai Academy of Social Sciences, said China has a solid foundation and the right conditions to achieve steady growth with support from its ultra-large domestic market, strong innovative capability and ongoing efforts to deepen reforms and opening-up.

"The growth target of around 5 percent is reasonable and realistic," said Quan, who is also a deputy to the 14th National People's Congress, the country's top legislature, in an exclusive interview with China Daily. "China still has sufficient room for industrial upgrade, technological innovation and productivity improvements."

Citing measures listed in the latest Government Work Report, Quan said the country is taking a more pro-growth stance, which will bolster the world's second-largest economy, help stabilize expectations and boost confidence.

Quan, however, cautioned that the broader economy is still facing pressures and uncertainties from a more complex international environment.

He said the country needs to further step up macroeconomic policy support, including strengthening both fiscal and monetary policies and making full use of policies on deepening reforms and opening-up.

More efforts should also be made to fully stimulate the vitality of market entities and further boost technology innovation, in a bid to foster high-quality development, he said.

China will intensify countercyclical and cross-cyclical adjustments through macro policies and continue to implement a proactive fiscal policy and a prudent monetary policy, according to the Government Work Report.

The work report said the country will also strengthen coordination between policies relating to fiscal, monetary, employment, industrial, regional, scientific, technological and environmental fields while developing new policy instruments, in order to create synergy for high-quality development.

Quan said pessimism on the Chinese economy in Western media is unfounded as there is still huge potential for economic growth.

"China's per capita GDP is around $13,000, which is similar to South Korea's level in the 1990s. That means there's a huge amount of development space," he said.

Quan said given that China's GDP is 126 trillion yuan ($17.5 trillion), double-digit growth seen in the past may not be possible now — and any such expectations would be unrealistic. It is of great importance for China to pursue growth for high-quality development instead of simply seeking high-speed growth.

China's economy is showing fresh signs of a steady rebound with recent indicators pointing to a good start for 2024.

Data from the National Bureau of Statistics showed the country's consumer prices returned to positive territory for the first time in six months thanks to Spring Festival holiday spending. The country's consumer price index, a main gauge of inflation, rose 0.7 percent year-on-year in February after a 0.8 percent decline in January, well above market expectations.

Quan said he believes China's overall prices will likely remain stable in 2024, considering the country's solid steps to stabilize prices and the improved consumer sentiment.

"As the economy continues the recovery trend, China's CPI will grow moderately and there won't be deflation in the Chinese society," he said. "With effective government measures to stimulate consumption and expand effective investment, China is capable of keeping its overall price level within a reasonable range."

To better tackle issues like lack of effective demand, Quan said it is advisable for the country to take more measures to further boost domestic demand, including improving household income growth expectations, optimizing the consumption environment and expanding spending in fields like "new infrastructure", technological innovation, urban renewal and renovation of old urban residential communities.

Looking at the full year, he said while foreign trade may face uncertainties from the external environment, boosting consumption and expanding effective investment will become key drivers of China's growth in 2024. "I believe China's economy will perform better this year."