Xinhua News Agency

Wen warns of huge challenges for China

PUBLISHED : Sunday, 28 February, 2010, 12:00am
UPDATED : Sunday, 28 February, 2010, 12:00am

Premier Wen Jiabao said 2010 would be the most complex year yet this century for the mainland economy, and pledged to prevent inflation and rein in skyrocketing property prices, in an online chat yesterday with internet users.

He also addressed concerns over trade frictions with the US, and called for efforts to ease tensions.

Wen's internet question-and-answer session came in the run-up to the annual session of the National People's Congress, where he will deliver the annual government work report.

Xinhua said some 65,000 questions on subjects ranging from home prices to the homework burden for students, flooded into the central government's website and that of the news agency, the joint organisers of the session.

The questions Wen answered were apparently picked to cover the major topics in his government report.

'If last year was the most difficult for China's economy in the new century, this one is the most complicated,' Wen said.

He was determined to bring property prices under control during his tenure as premier, he said, but he admitted the government may not be able to 'rein in this wild horse' this year despite a series of measures. Wen is expected to step down in 2013.

He said the government would focus on building more affordable housing for low-income groups and rein in property prices through land, financial and tax policies.

Soaring property prices have become a major source of grievance for the public, especially the growing urban population. Xinhua said home prices rose by 9.5 per cent in January from a year earlier.

Wen reiterated the government would adopt an 'appropriately loose monetary policy' to ensure stable economic development. Agricultural production would be boosted to ensure food supplies.

He identified corruption and inflation as major threats.

On the trade front, Wen hoped tension would ease and this year would not be an 'unpeaceful year' for Sino-US trade ties.

'The friction ought to be solved through negotiation on an equal basis, and not through quickly imposed sanctions,' he said. 'We expect both countries to open markets to each other. In particular, the Unites States should acknowledge China's market economy status and open the exports of hi-tech products to China.'

The government would step up reform of the household registration system to ensure equal benefits for rural migrants in small cities and towns, he reiterated.

He warned that the job market remained grim. A record 6.3 million university students will graduate this year.

Wen said he was aware of the importance of a fair distribution of social wealth for maintaining stability, and said public supervision was the most effective way to curb misappropriation of public funds.

He also elaborated on an earlier remark that he wanted Chinese people to live with dignity, saying the government had the responsibility to 'protect every individual's freedom and rights'. It should also ensure the creation of favourable conditions for individuals to have freedom and the benefits of all-round development.