China Sets Ambitious Growth Goal amid Trade War

Beijing also announced a rare hike in fiscal funding, allowing its budget deficit to reach four percent this year.

Under the plans, some 12 million new jobs will be created in Chinese cities as Beijing pushes for two percent inflation this year.

A government report vowed to make domestic demand the "main engine and anchor" of growth, adding that Beijing should "move faster to address inadequate domestic demand, particularly insufficient consumption.".

And in a rare move, Premier Li Qiang said China would hike its fiscal deficit by one percentage point, something that analysts have said will give Beijing more latitude to address its economic slowdown.

Major Asian markets traded up on Wednesday, reversing their losses a day after U.S. President Donald Trump went ahead with imposing more blanket tariffs on Chinese imports following a similar move last month.

U.S. tariffs are expected to hit hundreds of billions of dollars in total trade between the world's two largest economies.

"Internationally, changes unseen in a century are unfolding across the world at a faster pace," the government work report said.

"Unilateralism and protectionism are on the rise," it warned.

And "domestically, the foundation for China's sustained economic recovery and growth is not strong enough," added the report.

Also on March 5, China disclosed a 7.2 percent rise in defense spending in 2025, as Beijing rapidly modernizes its armed forces amid regional tensions and strategic competition with the U.S.

Geopolitical tensions between Beijing and Washington are set to intensify this year, analysts say.

US will feel 'disturbance'

Beijing on Tuesday announced its own measures in retaliation for Washington's latest tariff hike—and vowed it would fight a trade war to the "bitter end."

The moves will see China impose levies of up to 15 percent on a range of U.S. agricultural products, including soybeans, pork, and wheat, starting from early next week.

The U.S. economy is set to see some "disturbance" from tariffs, President Donald Trump said Tuesday, but he touted levies as a tool that would help domestic industries boom.

"Tariffs are not just about protecting American jobs. They're about protecting the soul of our country," Trump said in his first address to a joint session of Congress since returning to the White House.

"There'll be a little disturbance, but we're okay with that. It won't be much."

Trump also took aim at the European Union and countries including Canada, Brazil, India, Mexico, and South Korea over what he called "unfair" practices.

"This is happening by friend and foe. This system is not fair to the United States and never was," he said.

He added that reciprocal tariffs tailored to U.S. trading partners would "kick in" on April 2.

Since returning to office, Trump has moved swiftly to impose tariffs hitting some $1.4 trillion in U.S. imports from Canada, Mexico, and China—with further levies in the pipeline.

U.S. Commerce Secretary Howard Lutnick also said that Trump is "going to work something out" on Canada-Mexico tariffs.

Canadian Prime Minister Justin Trudeau reacted to Trump's decision to implement tariffs on Canada, saying that it is "a very dumb thing to do."

Source: HDN