China's economic growth target has been set at 4.5%-5%, the lowest since 1991, as the country navigates domestic and global challenges. This marks the first time the target has been lowered since 2023, when it was set at 'around 5%'. The announcement came during China's 'two sessions', a significant political gathering, alongside the unveiling of the 15th Five-Year Plan for the world's second-largest economy. Beijing is aiming to reshape its economy, addressing issues like weak consumption, a shrinking population, a property crisis, global trade tensions, and an energy crunch due to the Iran war. The plan includes investments in innovation, high-tech industries, scientific research, and boosting household consumption. However, the country's economic growth should be taken with a 'grain of salt' as other data suggests a weaker economic picture, with people being cautious about spending and the real estate crisis weighing on growth. The US President's tariffs have further pressured China's export-reliant economy, and the US-Israel war with Iran has lost Beijing two key sources of cheap oil this year. Despite these challenges, China is transitioning to renewable energy and aims to lead a green energy push, reducing carbon emissions and improving environmental protection.
