China is showing confidence in achieving its annual economic growth target of "around 5%" despite the tariff war with the United States. It has particularly expressed confidence that it can adequately respond even if imports of U.S. agricultural products and energy are suspended.
According to the Hong Kong South China Morning Post (SCMP) on the 28th (local time), China's senior economic officials emphasized that the Chinese economy could grow without the United States.
Zhao Chenxin, deputy director of the National Development and Reform Commission of China, noted at a press conference themed "Policies to promote employment and economic stability and high-quality development" that "while external shocks are increasing, China can achieve its 5% growth target this year." Deputy Minister of Commerce Shang Wu Ping also stated that "Chinese exports continue to rise in April, even after the trade war."
Deputy Director Zhao Chenxin stated, "Feed grains and oilseeds can be substituted (besides U.S. imports), so the suspension of imports will not have a significant impact," adding, "We can adequately and stably supply energy while reducing reliance on the United States." He further noted, "By increasing domestic production and expanding imports from countries other than the U.S., we can sufficiently meet demand."
China has set a target to achieve a GDP growth rate of "around 5%" this year, following last year's goal, and the growth rate for the first quarter of this year recorded 5.4%. While China has optimistic forecasts, global economic institutions noted that the effects of the trade war have not yet been fully reflected, offering projections in the 4% range.
Currently, the U.S. imposes a 145% tariff on China, while China imposes a 125% tariff on the U.S., resulting in tariff rates between the two countries exceeding 100%. This has led to a reduction in trade volume between the two nations, and some factories in China have already begun reducing workers, indicating that the damage is becoming a reality.
The loss of the Chinese market is expected to deal a significant blow to the United States. In 2023, the U.S. exported approximately $33 billion (about 45 trillion won) in agricultural products and $15 billion (about 20 trillion won) in oil, natural gas, and coal to China. However, China's reliance on the U.S. is gradually decreasing. The share of U.S. food imports in China, which was 20.7% in 2016, has plummeted to 13.5% in 2023, while the share from Brazil increased from 17.2% to 25.2% during the same period.
The Chinese government plans to focus on preparing internal countermeasures rather than external negotiations. Authorities plan to expand financial and credit support for exporting companies to stimulate the economy and stabilize employment, as well as reinforce support for manufacturers to target both domestic and overseas markets.
Zhou Ran, vice governor of the People's Bank of China, stated, "We can lower the reserve requirement ratio and the Loan Prime Rate (LPR, effectively the base rate) at an appropriate time, and we will maintain the yuan exchange rate stably." The Ministry of Human Resources and Social Security also decided to expand the recruitment of university graduates in state-owned enterprises and to strengthen the disbursement of support funds and subsidies for creating new jobs.
Youth unemployment has emerged as a serious issue facing Chinese society. As of March, China's urban unemployment rate was 5.2%, while the youth unemployment rate approached three times that at 16.5%. Louise Liu, a senior researcher at Oxford Economics, analyzed that "While the Chinese government is taking steps to boost household consumption and support corporations affected by tariffs, stabilizing employment remains the top priority."