Photo/Illutration Chinese President Xi Jinping, left, and Premier Li Qiang during the opening ceremony of the annual meeting of the National People’s Congress at the Great Hall of the People in Beijing on March 5 (The Asahi Shimbun)

The annual meeting of the National People’s Congress (NPC), China’s legislative body, commenced in Beijing on March 5.

This date coincides with "Jingzhe," known as “Keichitsu” in Japan, the third of the 24 solar terms according to the traditional Chinese calendar, heralding the arrival of spring.

Despite the seasonal signs of renewal and growth, a pervasive sense of uncertainty looms over China’s economic and societal future.

Due to an extended slowdown in economic growth, compounded by a prolonged slump in the real estate market, many citizens are losing hope in the adage “tomorrow will be better.”

Reflecting the prevailing gloom, the number of marriages in China last year plummeted by 20 percent compared with the previous year. The unemployment rate among urban youth stands alarmingly high at 16.1 percent as of January.

Although the series of random killings from last year has abated, the pervasive sense of stagnation continues to linger.

Further complicating the nation’s challenges is the trade policy of the U.S. administration under President Donald Trump. A tariff war is brewing, and trade with the United States, which makes up 30 percent of China’s trade surplus, is inevitably set to contract.

This scenario makes it increasingly difficult for Chinese policymakers to rely on foreign demand for economic growth.

Nevertheless, Premier Li Qiang maintained an economic growth target of around 5 percent in his government activity report at the NPC, mirroring last year’s target--a decidedly optimistic stance.

The critical question, however, remains whether the strategies to achieve this growth are both reasonable and adequate.

Li announced that the ratio of the fiscal deficit to gross domestic product (GDP), previously maintained at 3 percent, has been increased to 4 percent. This adjustment indicates a move toward a more expansive fiscal policy.

Meanwhile, the primary economic policy focus outlined in the report is to boost consumer spending. The policy initiative to support the replacement of consumer goods, launched last year, will persist, with an increased budget allocation. However, the impact of this program is anticipated to be temporary.

The most effective way to alleviate anxiety among consumers who are focused on saving for uncertain times is to improve the social security system. China has transitioned into an aging society, necessitating robust enhancements to the pension and health care programs.

However, this year’s report shows no substantial changes in these areas. In stark contrast, the defense budget has seen a 7.2-percent increase from the previous year, surpassing the growth rate of the overall budget.

President Xi Jinping’s administration is turning its attention to the private sector as a means to rejuvenate the stagnant economy.

In February, Xi personally convened a roundtable with prominent entrepreneurs, including Liang Wenfeng, the founder and CEO of the rising artificial intelligence startup DeepSeek.

Additionally, the NPC report explicitly included provisions for “supporting” private businesses.

Historically, the Xi administration has shown a marked preference for bolstering state-owned enterprises, often neglecting the private sector, which has created an impression of a regression toward more socialist policies.

Simply championing private enterprises as a temporary fix during economic downturns is unlikely to alleviate the skepticism prevailing within the corporate community.

The effort to draft the private economy promotion law, which aims to ensure that private enterprises receive treatment equal to that of state-owned entities and to facilitate their involvement in national projects, has been under way since last year.

Although this bill is not included in the current NPC session’s agenda, there is strong hope that deliberations will be expedited to enhance future opportunities for private sector growth.

--The Asahi Shimbun, March 6

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