WHEN China’s leaders set an economic growth target of “around” 5 per cent for this year, the goal was universally described as ambitious. Now the country looks increasingly likely to meet it.

Several foreign banks, including Citigroup, Goldman Sachs and Morgan Stanley, have recently raised their forecasts. Figures released on Apr 16 showed that the economy grew by 5.3 per cent in the first quarter, compared with a year earlier – quicker than expected and faster than the target requires.

How is this happening? Countries at China’s stage of development often shift towards services. But China’s leaders have a soft spot for “hard” output.