Beijing, Dec 26: China’s economic growth is likely to stand at 7.6 percent this year, slightly down from 7.7 percent in 2012, authorities said.
Economic growth has been higher than expected since 2011 despite a declining trend, said a mid-term evaluation report Wednesday on the implementation of the 12th five-year development plan (2011-15), reported Xinhua.
The report was submitted by the State Council, China’s cabinet, to the bi-monthly session of the Standing Committee of the National People’s Congress (NPC).
The five-year plan set an annual growth target of gross domestic product (GDP) at 7 percent between 2011 and 2015. GDP growth was 9.3 percent in 2011, 7.7 percent in 2012 and 7.6 percent in the first half of this year, according to the report.
“We can not deny a downward pressure on economic growth,” said Xu Shaoshi, minister in charge of the National Development and Reform Commission (NDRC), when briefing lawmakers about the report.
There are uncertainties in global economic recovery and the international market has failed to produce strong demand, Xu said.
At home, labour cost increases and environmental costs to enterprises are catching up, which challenges the traditional growth pattern, he said.
The economy is also challenged by increasing risks in local government debt, the financial sector and overcapacity, which resulted from blind government investment in industrial projects, he said.
Investing a large amount of funds in low-profit infrastructure projects, industries with excess capacity and real estate projects has reduced liquidity and efficiency, Xu said.
The report also listed several other challenges ahead, including slow economic restructuring, worsening pollution and social conflicts among interest groups.
The State Council said the solution is comprehensive reform in various sectors to realize the market’s decisive role in allocating resources and improve government performance.