Chinese Premier Li Qiang announced a 5 per cent growth target for 2025 for the economy on Wednesday morning while delivering the government’s annual work report at the National People’s Congress, the biggest political huddle in the country, the bullish growth target seen as a dare to US President Donald Trump at a time when he has declared a trade war with the world’s second biggest economy.

The ambitious growth target of 5 per cent — for a record third time in a row — was accompanied with a projection of the highest general budget deficit in more than three decades, signalling a plan to boost domestic consumption to counter the effects of rising US tariffs.

According to Li’s annual work report, the fiscal deficit target for the year will be 5.66 trillion yuan ($780 billion), or around 4 per cent of China’s gross domestic product.

The scale of the stimulus for the Chinese economy, captured in the deficit, can be gauged if compared with the fiscal deficit target of about $200 billion that Union finance minister Nirmala Sitharamn set for the fiscal 2025-26 in her budget proposals tabled last month.

“This number reflects that the authorities are determined to support growth against the backdrop of external uncertainties and trade tensions with the US,” Bloomberg quoted Raymond Yeung, chief economist for Greater China at Australia & New Zealand Banking Group.

“It’s an ambitious growth target, and it means the authorities will still need to support growth.”

Li outlined his blueprint for China’s economy a day after Trump imposed another 10 per cent tariff on China, threatening to slam the brakes on the export engine that has been the main driver of Chinese growth story, contributing almost a third of economic expansion last year.

The sense of purpose in the speech of Li -- who stressed on the need to take difficulties “head on” and surge ahead -- was apparent as Bloomberg reported that the word “consumption” was mentioned 27 times throughout the document, the most in at least a decade.

“In contrast, “high-quality development,” a slogan representing President Xi Jinping’s push to boost high-tech manufacturing, was mentioned much less frequently than last year.

“In setting the growth rate at around 5 per cent, we have taken into account the need to stabilize employment, prevent risks, and improve the people’s wellbeing,” said Li.

As per the plan, the government will sell 1.3 trillion yuan ($179 billion) worth of special sovereign bonds and use 300 billion yuan of the proceeds to finance a subsidy programme for residents’ purchases of consumer goods, doubling its size in 2024. The rest of the money will go toward building major infrastructure projects and encouraging businesses to upgrade their equipment.

While the measures are welcome, analysts think that the markets will want more in a country characterised by low household spending, about 45 per cent of the GDP.