China looks to green economy to hit GDP growth target of 7.5 per cent

Country also puts focus on consumers to drive growth.

At the annual meeting of the National People's Congress in Beijing, Chinese premier Wen Jiabao announced that the growth target for the PRC would remain at 7.5 per cent, the same as last year. In 2012, China only just made the target, as growth slowed to its most leisurely rate in 13 years, expanding by "just" 7.8 per cent.

While the growth goal remains the same, China has lowered its inflation goal to 3.5 per cent, and is planning to increase its budget deficit by 50 per cent to £128bn to "maintain support for economic growth", according to Jiabao.

Separately, the National Development and Reform Commission reported its own targets, aiming for an 8 per cent increase in foreign trade (down from 10 per cent).

As well as the economic targets, China also used the draft budget to announce an increase in military spending, growing 10.7 per cent to £76.41 billion. The Financial Times' Kathrin Hille adds:

Despite the increasingly tense regional climate, experts agree that the days of the sharpest defence spending hikes are over.
This year’s 10.7 per cent increase is roughly in line with last year’s 11.2 per cent hike and a 12.7 per cent increase in 2011.
These figures compare with annual average increases of 16.5 per cent between 2000 and 2009 and 15.7 per cent between 1990 and 1999, according to a forthcoming article by Adam Liff and Andrew Erickson, two US experts on Chinese military affairs.

China's insistence that it will hit the 7.5 per cent growth target indicates the country is not concerned that it may experience a "hard landing" — a quicker-than-expected decline from its current levels of growth to the developed-nation norm of 2-3 per cent. The country has, however, experienced some problems following its current model of growth, which Reuters describes as "investment-driven" and "export-oriented".

As the rest of the world struggles on through the most prolonged depression in living memory, China's export strength has started to look like a double-edged sword, exposing it to weakness it would otherwise be inured to. And its investment-driven growth has also led to massive "ghost cities", hundreds of thousands of new homes built with no-one living in them.

Instead, Jiabao seemed to highlight a model of development which fits with the trend started by the proposal of a Chinese carbon tax, telling the assembly:

The state of the ecological environment affects the level of people's well-being and also posterity and the future of our nation. We should adhere to the basic state policy of conserving resources and protecting the environment and endeavor to promote green, circular and low-carbon development.

But the country still has massive internal issues to overcome before it can really change tack on growth. Local government in China has tremendous independence, and will need to get on board with the plans. Reuters reports:

In a separate document, the Ministry of Finance said it was raising the quota for bonds issued by local governments to 350 billion yuan in 2013, compared with 250 billion yuan in 2012.
It also pledged to further strengthen regulation of local government debt and curb irregular financing activities.

The government has its work cut out.

Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Theresa May's speech on the Westminster terror attack

"We will all move forward together. Never giving in to terror. And never allowing the voices of hate and evil to drive us apart." 

I have just chaired a meeting of the Government’s emergency committee, COBRA, following the sick and depraved terrorist attack on the streets of our Capital this afternoon.  

The full details of exactly what happened are still emerging. But, having been updated by police and security officials, I can confirm that this appalling incident began when a single attacker drove his vehicle into pedestrians walking across Westminster Bridge, killing two people and injuring many more, including three police officers.   

This attacker, who was armed with a knife, then ran towards Parliament where he was confronted by the police officers who keep us – and our democratic institutions – safe.  

Tragically, one officer was killed. The terrorist was also shot dead.   The United Kingdom’s threat level has been set at severe for some time and this will not change. Acting Deputy Commissioner Rowley will give a further operational update later this evening.   Our thoughts and prayers go out to all who have been affected – to the victims themselves, and their family and friends who waved their loved ones off, but will not now be welcoming them home.

  For those of us who were in Parliament at the time of this attack, these events provide a particular reminder of the exceptional bravery of our police and security services who risk their lives to keep us safe.

Once again today, these exceptional men and women ran towards the danger even as they encouraged others to move the other way.   On behalf of the whole country, I want to pay tribute to them – and to all our emergency services – for the work they have been doing to reassure the public and bring security back to the streets of our Capital City.   That they have lost one of their own in today’s attack only makes their calmness and professionalism under pressure all the more remarkable.  

The location of this attack was no accident. The terrorists chose to strike at the heart of our Capital City, where people of all nationalities, religions and cultures come together to celebrate the values of liberty, democracy and freedom of speech.   These streets of Westminster – home to the world’s oldest Parliament – are engrained with a spirit of freedom that echoes in some of the furthest corners of the globe. And the values our Parliament represents – democracy, freedom, human rights, the rule of law – command the admiration and respect of free people everywhere.   That is why it is a target for those who reject those values.   But let me make it clear today, as I have had cause to do before: any attempt to defeat those values through violence and terror is doomed to failure.

Tomorrow morning, Parliament will meet as normal. We will come together as normal.   And Londoners - and others from around the world who have come here to visit this great City - will get up and go about their day as normal.

They will board their trains, they will leave their hotels, they will walk these streets, they will live their lives.

And we will all move forward together. Never giving in to terror. And never allowing the voices of hate and evil to drive us apart.