Mainland aims to avoid slowdown
Beijing has for the first time named averting an economic slowdown as a top priority, with officials becoming increasingly fearful a global economic slump will hit the mainland harder than expected.
The statement from the State Council made public yesterday reveals a subtle but important change in macroeconomic policy at the highest level and is a shift from the situation in December when preventing overheating and curbing inflation were listed as the top priorities.
While the government says it is still committed to fighting inflation, economists said the growing fragility of the global financial system meant Beijing would loosen some of its austerity measures in the months ahead.
The State Council yesterday said it would take the new situation facing the world and domestic economies into consideration and be flexible in administering controls 'to actively deal with various difficulties and risks'.
That came as mainland stocks plummeted to a 12-month low and the World Bank trimmed the nation's economic growth forecast. Rising fears the world's fastest-growing major economy is headed for a hard landing may mean Beijing will rethink austerity measures curbing credit and cutting investment.