Premier Li targets China growth range of 6.5-7pc for 2016
Time：2016-03-08
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The government has also dropped its annual trade target, while the Ministry of Finance said China`s fiscal deficit was slated to increase to three per cent of GDP in 2016, up from 2.3 per cent in 2015, while money supply will rise by 13 per cent, up from a 12 per cent goal last year.
Premier Li`s work report was released at the same time as the 2016 budget, the 2016-2020 Five-Year Plan and a new report from the National Development and Reform Commission.
"The package of monetary stimulus, higher deficit, and restructuring of the state sector is a surprisingly coherent response to China`s downturn," said Andrew Collier, an independent China analyst in Hong Kong and former president of the Bank of China International USA.
"The problem is there`s a lot of bad lending going on behind the scenes at the banks that`s slipping through the cracks," he said.
The slowest growth in 25 years has prompted the central bank cut the ratio of reserves banks must lock away.
Moody`s Investors Service lowered China`s credit-rating outlook to negative from stable, highlighting a surging debt burden and falling currency reserves while questioning the government`s ability to enact reforms.