Tariffs to Climate: The Big Takeaways From China’s Two Sessions
China has set a GDP growth target of 5% for 2025 amid rising economic challenges, including an escalating trade war with the U.S. and sluggish domestic demand. Outlining China’s annual policy roadmap at the Two Sessions, Premier Li Qiang pledged stronger fiscal support, measures to boost household spending, and policies to stabilize key industries.
“Internationally, changes unseen in a century are unfolding across the world at a faster pace,” Premier Li said while delivering his annual report at the opening session of the National People’s Congress, China’s top legislature. Warning of mounting pressures in trade, technology, and economic stability, Li reaffirmed that China would “continue to open up, steadily expand institutional openness, and drive reform.”
Starting this week, China’s “Two Sessions,” or lianghui, brings together lawmakers and political advisors to set the country’s policy agenda. The meetings of the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC) will outline economic priorities, social policies, and key reforms, offering a window into the government’s plans for the year ahead.
From fiscal stimulus and job creation to innovation and market reforms, here are this year’s top takeaways.
Global trade
With President Donald Trump doubling tariffs to 20% on all Chinese imports, China responded with retaliatory tariffs of up to 15% on key U.S. agricultural products, expanded export controls, and filed a complaint at the World Trade Organization.
To cushion the impact, China is ramping up fiscal support. It has raised its budget deficit to 4% of GDP — the highest level in decades — to enhance government spending. Li also announced measures to stabilize foreign trade, including expanding export credit insurance, promoting cross-border e-commerce, and improving logistics.
According to Li, China will also offer zero-tariff treatment on all products from the “least developed countries” with diplomatic ties to China. It will also expand unilateral visa exemptions and extend the duration of transit visa-free stays to 240 hours, aiming to boost inbound tourism and strengthen economic ties.
Boosting consumption
Premier Li acknowledged that household consumption remains weak, with pressures on job creation and income growth. To stimulate demand, he said China would implement measures to raise incomes, expand services, and enhance the overall consumption environment.
Key initiatives include issuing a 300 billion yuan ($41 billion) long-term treasury bond for trade-ins, accelerating digital and green consumption, optimizing holidays to boost tourism and sports spending, and improving duty-free shopping policies. China will also tighten oversight on unfair pricing, improve product safety regulations, and act against fraudulent business practices.
China aims for a 2% rise in the consumer price index, with policies designed to balance supply and demand. “Achieving these targets will not be easy; it will require arduous efforts,” Li cautioned.
Jobs, housing, and markets
Li pledged stronger efforts to stabilize employment, real estate, and financial markets — key pillars of China’s economic recovery.
The government aims to create over 12 million new urban jobs, with targeted support for fresh graduates, migrant workers, and low-income groups. Policies will encourage businesses to hire, while financial aid for students from disadvantaged backgrounds will be expanded.
To revive the real estate market, restrictions will be eased based on local conditions, urban renewal projects will accelerate, and cities will have more autonomy to manage existing properties. In financial markets, structural monetary policies will be optimized to boost investor confidence.
“Our goal is to meet people’s needs for high-quality living and promote the construction of houses that are safe, comfortable, green, and intelligent,” Li underscored.
Climate change
Li reaffirmed China’s commitment to peaking carbon emissions and achieving carbon neutrality, with new national pilot projects underway to accelerate the transition. Along with efforts to promote green development, the government will launch a comprehensive plan for major climate initiatives, focusing on resource efficiency and low-carbon innovation.
China also aims to take a more active role in global climate governance, positioning itself as a leader in environmental cooperation and sustainable development.
(Header image: VCG)
