Li says economy to keep growing

2015-03-15 23:49:39 GMT2015-03-16 07:49:39(Beijing Time)  Shanghai Daily

THE Chinese government has more weapons in its arsenal to boost the world’s second-largest economy, Premier Li Keqiang said yesterday as he sought to ease concerns about flagging growth.

Addressing a news conference at the end of China’s annual session of top legislature, Li tried to allay fears about a stumbling economy by vowing to keep it growing at a reasonable speed, even as he acknowledged the job is not easy.

He said policymakers would prop up the economy if growth was at risk of breaching a “lower limit,” or hurt employment and incomes.

“In recent years, we have not taken any strong, short-term stimulus policies, so we can say our room for policy manoeuvre is relatively big, the tools in our toolbox comparatively many,” Li said.

“If the slowdown in growth affects employment and incomes, and approaches the lower-limit of a reasonable range, we will stabilise policies and the market’s long-term expectations for China,” he said.

On government plans to deliver economic growth of around 7 percent this year, Li said: “It looks like economic growth has been adjusted lower, but in reality achieving this target will not be easy.”

He said it was a challenge for the government to deliver economic growth of about 7 percent this year because the economy was already worth more than US$10 trillion.

However, Li said that authorities would do what they could to keep growth “within a reasonable range,” and denied any assertion that China was exporting deflation.

Authorities have so far avoided big-ticket incentives to bolster growth like the unprecedented four-trillion-yuan stimulus package China deployed at the height of the global financial crisis.

But Li signalled that more measures could be taken, telling reporters: “We still have a host of policy instruments at our disposal. The good news is that in the past couple of years we did not resort to massive stimulus measures for economic growth.”

Li dismissed theories that China’s boom has seen it overtake the US to become the world’s No. 1 economy, describing such purchasing power parity calculations as a “misleading exaggeration.”

“According to authoritative standards, China is still the second-largest economy in the world,” he said, stressing that it remained “behind about 80 countries in the world” in terms of per capita GDP.

He recalled a recent visit he paid to rural families in the remote west, where he met a man in his 40s who could not afford to marry and a college student who depended on his younger sister’s income as a migrant worker in the cities to pay his tuition fees.

“It truly pains me to see our people living in such distress and I’m sure that there are many more such families in the vast land of China,” he said, adding that nearly 200 million Chinese remained in poverty by World Bank standards.

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