China maintains growth target at 7.5%

|By:, SA News Editor

China has kept its annual growth target at 7.5% for 2014, allaying the concerns of some but disappointing others that it would lower the goal as part of the government's focus on reforming the economy and trying to rein in ballooning credit.

However, in an address to the annual meeting of the National People's Congress, Chinese Premier Li Keqiang reiterated his commitment to reform to make growth more sustainable. China will cut idle factories and encourage private investment, and it has reduced its target for growth in fixed-asset investment to 17.5%, the slowest in 12 years.

As expected, China is continuing to target inflation of 3.5% and a fiscal deficit of 2.1% of GDP.

The government also intends to wage a "war" on pollution, including by reducing capacity in the steel and cement sectors.

Meanwhile, China's HSBC services PMI rose to 51 in February from 50.7 in January. However, composite PMI slipped into contraction territory with a fall to 49.8 from 50.8. In comparison, official non-manufacturing PMI rose to 55 from 53.4. (PR)

The Shanghai Composite closed at -0.9%.

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