Li Keqiang said China's economy would grow "by around 6.5%, or higher if possible," which was roughly in-line with economists' forecasts although some had seen the potential for a slightly lower goal.
In 2016, Beijing set a target for gross domestic product growth of between 6.5% and 7.0%.
Systemic risk was under control and economic fundamentals were sound, he said in his work report presented to the annual National People's Congress.
Nonetheless, Keqiang warned of both external and domestic risks on the horizon, such as a quicker pace of monetary policy tightening by the US central bank and trade protectionism from the new US administration.
Internally, authorities needed to be mindful of risks stemming from the country's shadow banking system and internet finance.
Excess industrial capacity, housing capacity in smaller cities and environmental damage were other factors to watch.
He also cited mounting downward pressures on growth and serious challenges from excess industrial capacity, including in steel and coal production, an overhang of housing inventory in small cities, and environmental degradation.
China's economy had reached a critical phase in its transition away from investment-led growth, he said.
On a regional basis, there were also increasing divergences in growth and the fiscal imbalance had increased.
Keqiang also said monetary policy would be "prudent and neutral".
On a related note, the growth target for M2 money supply was lowered from 13% to 12%, that for retail sales from 11% to 10% and that for fixed asset investment from about 10.5% to 9%.
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