China’s Li Keqiang vows stability as ‘complex and volatile’ international climate weighs on economy
- Premier Li Keqiang says the Chinese government will maintain stability in the face of ‘volatile international economic and political conditions’
- China’s economy will return to growth this year and surpass 100 trillion yuan, but faces ‘great pressure’ to ensure employment, Li says
Premier Li Keqiang on Wednesday acknowledged the “great pressure” facing China’s economy, both at home and in a turbulent environment abroad, but vowed the government would do all it could to drive stable and sustainable development.
“Under the complex and volatile international economic and political conditions, for a large economy like ours … stability means progress,” Li said in an article published by the state backed People’s Daily.
Though Li said China’s economy would return to growth this year and surpass 100 trillion yuan (US$15.2 trillion), he wrote it was “very difficult to keep the economy running smoothly”.
“Insufficient demand restricts the stable recovery of the economy,” he said. “Enterprises, especially small, medium and micro enterprises are having difficulties in production and operation.”
Stabilising employment and ensuring people’s livelihoods was facing “great pressure”, and China’s drive to accelerate innovation-driven growth was not meeting requirements, he added.
The new economic strategy announced by President Xi Jinping earlier this year focuses on technological progress and development of China’s enormous domestic market for growth, and is widely perceived as Beijing’s inward-looking response to external hostility.
However, Li reiterated in the article the government was not shutting itself off from the rest of the world.
“We must not only close the door and engage in closed operation, but firmly implement the strategy of expanding domestic demand, while also making greater effort to open up,” he said.
The treaty includes China and 14 other Asia-Pacific economies – though not the US and India – and covers nearly one third of the world’s population and gross domestic product.
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“We have always chased for the speed of growth,” said Yao at a press conference on Wednesday. “This is why we don’t have sufficient drive for innovation. China’s economy is huge but it’s not strong – we lack key technology.”
China must also address threats to dominant position in global manufacturing, its shrinking working population and rising labour costs, said Yao, who was formerly chief economist at the National Bureau of Statistics
“These numbers are telling us that China’s advantages are changing,” he said. “It’s not like the old days when we had unlimited supply of cheap labour.
“We must put all our economic focus on the domestic market.”