China expected to set lower growth target at legislature
BEIJING (AP) — Chinese leaders are expected to cut their growth target to allow more flexibility in overhauling their slowing, state-dominated economy when their legislature meets this week.
A recent spate of turmoil in financial markets partly triggered by China's tinkering with exchange rate policies has added to concerns over the leadership's handling of the transition to more balanced growth.
China is not headed for a "hard landing," Wang Guoqing, spokesman for the Chinese People's Political Consultative Conference, a government advisory body, told reporters.
Advocates of faster reforms complain China is stalling on repeated promises to trim monopolies, subsidies and other privileges of the 106 national-level and 150,000 local state-owned companies that dominate industries from oil and banking to telecoms and steel.
"Chinese leaders must be aware of the situation, but there is a question whether they are strong enough to initiate a change because interest groups are formidably strong," said Sheng Hong, director of the Unirule Economic Institute, a private research group in Beijing.
[...] the congress may showcase "supply-side reform" — the ruling party's term for shrinking bloated industries from steel to cement to aluminum in which supply vastly exceeds demand.
Steel producers have responded by exporting their surplus, prompting complaints by China's trading partners.
A deputy finance minister, Zhu Guangyao, talked openly about the political challenges this week during a visit by U.S. Treasury Secretary Jacob Lew.