Editorial | Reform comes first in delicate balancing act for China’s economy
- Despite the economic slowdown, Beijing believes the window of opportunity remains open for further opening up to ensure growth is sustainable and not just about numbers
Growth in the world’s second biggest economy is slowing at an alarming rate, prompting some experts to predict it will come in at under 4 per cent in the fourth quarter. Beijing is on high alert.
This is reflected in warnings by Premier Li Keqiang that the economy is facing new downward pressure and a meeting in Shanghai between Li and provincial government heads to coordinate a response. This came four days after he raised concerns in a symposium with economists and entrepreneurs.
In an article in People’s Daily, Xi’s key economic adviser Liu He also raised the possibility of further reforms, including opening up. Liu said Beijing had pinned its hopes of steering the economy through uncharted waters on improving the quality of economic development and technological innovation.
“Given the profound changes in the world and national conditions, technological innovation is … “a matter of survival”, Liu said.
Amid the current slowdown, top-level attention is focused on the economy’s reliance on smaller private companies that account for 80 per cent of urban jobs and 60 per cent of gross domestic product. Support for this sector from local government is critical to economic expansion and job creation.
