By Anjan Roy
In a significant move, at the on-going China's National People's Congress, which is a gathering of legislators, the top leaders of the Communist Party of China have set a pared down growth target for China at only 5% for the current year. NPC is meeting in Beijing is weeklong.
This is a covert admission of the heavy hit China's economy has suffered from its extended “zero covid” policy which had ushered in long lockdowns of major cities and manufacturing centres. This is a far cry from the days when China used to grow by more than 10% for years on end. Liberalisation and integration with the global economy had given the necessary impetus to the Chinese economy to grow.
Shanghai, which is commercial capital of the country, had witnessed some of the harshest lock-downs in the country, affecting everything from manufacturing to financial services. In one notorious instance, which had now become a talking point, scores of residents in a high rise building had been roasted alive as the fire escapes were all locked down to ensure no movements of people from the building.
The policy had always carried the personal imprimatur of China's supremo, President Xi Jinping. However, the damning facts around failure of zero-covid policy are now being painted over with colours at the People's Congress.
As if to rub the point about the success of the zoo-covid policy and not its ill-effects, the NPC has endorsed elevating Xi Jinping's deputy, who was instrumental in implementing the zero-covid policy and its associated with lock downs and quarantine measures, is being appointed the next premier of China.
This is the irony of present system of ruling China from the perspective of the all powerful Xi Jinping. The entire nation has to dance to the tune of Xi and his whims, no matter what costs the ordinary people have to bear.
The People's congress is also anointing the new economic Czars of the country. A new governor of the Chinese central bank is being announced, apart from the new faces who are being invested with unprecedented powers for economic management at the party and government levels.
Experts are pointing out that the sharply revised growth target is being introduced so that the embarrassment of a slippage on this could be avoided. It could be far better to set lower targets and exceed these than setting a high targets and failing to attain.
So the current year's growth target of 5% is actually to be viewed as the floor level and efforts were to be directed at maximising the actual performance. However, given the situation in the country at present, it could be an uphill task to attain even a 5%.
Last year, for example, a growth target of 5.5% was set, against which actual growth was only around 3%. Heavy handed government policies on quarantine, as well as, curbing the powers of tech bosses had resulted in lower performance.
Chinese leadership has also jacked up the country's defence budget —7.2% of the national budget— in the face of rising hostilities and aggressive stance of China on various border issues. Additionally, the country had taken upon itself to squarely confront the USA on various counts and thus are beefing up the defence capabilities.
The extent of the jump in defence outlay had been noticeable and the defence establishment is concentrating its efforts on improving the technological base to improve upon and match USA.
The third element in the current proceedings of the NPC is the concern over declining population in the country. Some of the legislators are proposing almost weird ideas to get noticed by the leadership and also to come into the limelight.
One idea proposed by a legislator from the provinces is regarding providing incentives for young couples to get married. It is a fact that the astronomical costs of marriages in China are discouraging marriageable couples from tying the knots.
So a legislator had proposed government should give presents of gold jewellery to those willing to marry to overcome some of the cost constraints. This is followed up with another proposal for free education for children. Education of children have become extremely costly.
The Chinese authorities have been seeking to encourage population growth. China's population is fast going down like neighbouring Japan, though not as alarmingly. Demographers fear that China has also entered into a phase of declining population which could hardly reversed easily.
The current session of the National People's Congress is resulting in a competitive process for suggesting ideas for improvements in a variety of areas. .
One area of attention emerging is emphasis on science and technology development. This is however a step being pushed from the highest leadership as essential for China eventual confrontation with the United States. With inevitably declining population, China could hardly be expected to play the same great power role that it had started with imagining.
Remarkably enough, some of the commentators who had until recently maintained that twenty-first would be China's century are already talking that the Chinese century have already gone past before it could take hold.
(IPA Service)
