BEIJING (TIP): China has set a growth target of 7% for 2015, lowest in two decades. This lowered target reflects declining exports and foreign investments, besides the government’s fear of slipping into a “middle income trap” along with problems like industrial pollution.

“Downward pressure on China’s economy has continued to mount, and we have faced an array of difficulties and challenges,” Chinese premier Li Keqiang said, while explaining why he chose a GDP target that was even lower than the achievement of 7.4% in 2014. China would end 2015 with the highest ever budget deficit of 2.3 % of GDP against last year’s 2.1 %, the premier said. The country has entered an era of low growth rates, which is the “new normal,” he added.