• China may miss its annual economic growth target.
• Politburo, the ruling Communist Party’s top policy-making body, says it aims to keep growth within “a reasonable range” China is still pursuing a zero-Covid policy, which has resulted in full or partial lockdowns of major cities.

As Covid restrictions weigh on the world’s second largest economy, China has indicated that it may miss its annual economic growth target.

The Politburo, the ruling Communist Party’s top policy-making body, stated on Thursday that it aims to keep growth within “a reasonable range.”

It made no mention of the previously set official growth target of 5.5 percent.

China is still pursuing a zero-Covid policy, which has resulted in full or partial lockdowns of major cities.

The 25-member Politburo, chaired by President Xi Jinping, said in a statement following its quarterly economic meeting that leaders would “strive to achieve the best results possible.”

It also urged stronger provinces to work harder to meet their growth targets.

“The 5.5 percent growth target is no longer a must for China,” ING Bank’s chief China economist Iris Pang told the Wall Street Journal.

They also stated that China was urging larger provinces to compensate for those hardest hit by the lockdown.

“Beijing requested that relatively well-positioned provinces strive to meet economic and social targets this year,” Nomura analysts Ting Lu, Jing Wang, and Harrington Zhang wrote in a note.

“We believe Beijing is implying that GDP growth targets for provinces with less favourable conditions, particularly those hardest hit by the Omicron variant and lockdowns, may be more flexible.”

China announced earlier this month that its economy contracted sharply in the second quarter of this year.

During this time, large Chinese cities, including the major financial and manufacturing hub of Shanghai, were placed under full or partial lockdown.

China’s once-booming property market is also in a deep slump, with home sales falling for 11 months in a row.

Because of cash flow concerns, several Chinese developers have halted the construction of homes that have already been sold.

Some home buyers have threatened to stop paying their mortgages until the work is resumed in recent weeks.

In light of the pandemic, China made the unusual decision in 2020 to abandon its GDP targets.

GDP is a measure of an economy’s size. Economists and central banks closely monitor its expansion and contraction as one of the most important indicators of how well or poorly an economy is performing.

It also assists businesses in determining when to expand and hire more workers, as opposed to investing less and reducing workforces.

[embedpost slug=”/ukraine-war-russia-says-40-ukrainian-prisoners-killed-in-blast/”]