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China lowers expectation for economic growth in 2023

Chinese Premier Li Keqiang released a forecast that predicts lower economic growth for China on Sunday. File Photo by Stephen Shaver/UPI
1 of 2 | Chinese Premier Li Keqiang released a forecast that predicts lower economic growth for China on Sunday. File Photo by Stephen Shaver/UPI | License Photo

March 6 (UPI) -- The Chinese government announced a projected 5% growth in its economy for 2023, its lowest forecast in recent memory as officials warned of "headwinds" such as Russia's invasion of Ukraine and emerging from a prolonged COVID-19 lockdown.

China's Premier Li Keqiang issued a work report noting uncertainties around the world economy was contributing to slower growth.

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"There are still quite a few factors restraining the recovery and growth of consumption," the report said.

"Resuming growth in real estate investment is an uphill battle. Some local governments are finding economic recovery difficult and are facing prominent fiscal imbalances. Debt risks from local government financing platforms need to be addressed immediately."

Li's final report calls for the government to create 12 million jobs in towns and cities in 2023 to boost consumption. That is up from the 11 million jobs projected for 2022. Li said, though, the government would increase its fiscal spending by 5.6%, lower than the growth of 6.1% last year.

During his speech to the National People's Congress at Beijing's Great Hall of the People, Li said "insufficient demand" for domestic products remains a prominent issue while stabilizing employment has been "tough."

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China's business sector is trying to bounce back from years of draconian COVID-19 lockdowns that at times left the economies of entire cities paralyzed as the government worked to get the virus under control.

Marked with that, the relationship between China and the United States is at an all-time low, prompted in part by Taiwan, a self-governing island China calls a breakaway province that President Joe Biden has vowed to defend Taiwan move on it militarily.

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