Growth continues to lead the world, says premier
Print Edition
CHINA’S economy is growing at a “reasonable” pace and, despite growing pressures, the government can cope with the risks the country faces, according to Premier Li Keqiang.
In remarks published on Saturday after a special meeting of the State Council, Li said that China is continuing to steadily manage its economy, which is operating within an appropriate range and continues to lead the world in terms of growth.
But international instability had “increased the uncertainties around global economic recovery, and the impact on China’s financial market and imports and exports has also deepened, with the economy facing new pressure,” he said.
The premier defended China’s efforts to steer through a volatile period since mid-June, when China’s stock market plunged. On Friday, Shanghai’s benchmark index was nearly 38 percent below where it was on June 12.
The premier reiterated earlier remarks that there is no basis for continued depreciation of the yuan following its devaluation on August 11. The Chinese currency “will stay basically stable as a reasonable and balanced level,” he said.
Li said recent cuts in the reserve requirement ratio, interest rates, taxes and fees, and other measures aimed at stabilizing the market, were already paying off.
However, analysts say further measures are necessary to support the economy and calm markets.
China’s economy, which in the past produced double-digit growth, is slowing.
The government reported that annual growth in the second quarter was 7 percent.
Li said China would “enact more targeted and responsive macro-regulation to offset downward economic pressure, more robust reform and innovation efforts to energize the market, and more effective delivery to secure the positive momentum for growth.”
The premier said that China needed to encourage new forms of investment and financing by local governments and businesses, such as local debt swaps and corporate bonds.
He reiterated the role of an open, transparent capital market but said risk management needs to be improved to prevent regional or systemic risks.
“China has great potential for further development and is well capable of effectively managing risks and keeping them under control,” Li said.
On economic work in the coming months, Li said the country should face challenges head on, be well-prepared and adaptive for uncertainties, and do whatever it can to maximize positive factors and defuse negative ones.
The key is delivering results from decisions already made, with top priority given to development, he said.
Now that traditional drivers for growth are not as strong, Li said, it is important to come up with new measures to bolster reform and opening up.
He said that in the light of burgeoning consumer demand, new policies will be rolled out to unlock consumption potential and improve living standards.
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