https://www.bloomberg.com/news/articles/2018-03-05/china-keeps-economic-growth-target-steady-at-around-6-5
Sunday, March 4, 2018
China Sets 2018 GDP Target at about 6.5%
If there is any economy that has potential to match the power of America's economy then it has to be China. A country that within the last decade has posted GDP growth rates as high as 10 percent is now lowering its expectations for growth to 6.5 percent. This is still a massive gain compared to the 2-3% growth we see in America, but China has been turning its attention to other factors in the economy besides growth. For instance, China wants to cut its budget deficit percentage of GDP to 2.6 percent which would be down from its previous 3 percent. In addition, China is also focusing on creating economic stability by creating more urban jobs to replace its huge agricultural workforce along with attempting to decrease the income gap. In the end, China has implemented an economic system that allows them to focus on the very long run rather than the shorter run that those of us in America focus on.
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As mentioned in the article, China focuses on dynamic efficiency rather than static efficiency. Creating better equity in income distribution by creating more jobs in the agricultural sector seems like a great idea to encourage economic stability. Decreasing a budget deficit indicates higher taxes or lower government spending, which could affect consumers and firms but with a high economic growth rate and low unemployment, decreasing a budget deficit would would not have a major impact on the economy.
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