Premier: no risk of a hard landing

Premier Li Keqiang greets journalists yesterday before his annual press conference at the end of the annual meeting of the top legislature, the National People’s Congress. — Xinhua

Premier Li Keqiang greets journalists yesterday before his annual press conference at the end of the annual meeting of the top legislature, the National People’s Congress. — Xinhua

PREMIER Li Keqiang reassured investors yesterday that the world’s second-largest economy is strong and not at risk of a hard landing. He also stressed Beijing’s support for globalization and free trade at a time of rising protectionism.

Li acknowledged there were internal and external risks to China’s economy, but said talk of a sharp slowdown should stop.

“Almost every year I have heard a prediction of the Chinese economy having a hard landing,” Li told a news conference at the end of the annual session of the National People’s Congress.

“But I believe that our economic performance in the past several years ... should suffice to put a full stop to such prophesies of a hard landing.”

China has cut its economic growth target this year to around 6.5 percent from its 2016 goal of 6.5 to 7 percent, while vowing to push through reforms to tackle rising debt and guard against financial risks. The economy grew 6.7 percent last year.

“As for the projected target of GDP growth this year at about 6.5 percent, I have read some foreign media describing it as a move by the Chinese government for moderate downward adjustment of GDP growth,” Li said. “I should point out that 6.5 percent growth is not low speed and will not be easy for us to meet.”

Figures released in recent weeks have shown that the economy got off to a strong start this year, though growth appears still heavily dependent on credit, infrastructure investment and the property market.

Private investment also rebounded over the first two months, which authorities attributed to policy support and a better economic environment compared to a year ago.

Li said China will look to cut taxes and fees on companies by 1 trillion yuan (US$144.67 billion) this year, while adding that the government has enough policy tools to handle any risks.

“We need to take very seriously the risks we are facing on the domestic front, especially in the financial sector ... We will take prompt and targeted measures to prevent them from further spreading,” Li said. “China’s financial system is generally stable and there are no systemic risks. We still have a good reserve of policy options and instruments at our disposal.”

Li said it is China’s consistent position to champion globalization and support free trade.

All countries have benefited from globalization, he said, though there have been some problems in the process, such as issues with distribution.

“China is willing to work with other countries to improve the global governance system,” he said.

Globalization and world peace, development and cooperation are inseparable, Li said, adding that closing the door and adopting beggar-thy-neighbor policies would not solve any problems.

China, like many other countries, is a beneficiary of globalization, as the country has been consistently expanding its opening up, he said.

“China will open its door wider and wider,” Li added.

Last year, China attracted US$126 billion in foreign direct investment, remaining the largest recipient among developing countries, figures showed. Meanwhile, a World Bank evaluation revealed China’s business environment had seen continuous improvement over the past three years.

“We are committed to make China a highland of opening up and a popular destination of investment, and share the development opportunities with the world,” Li said.

Efforts from all countries are needed in supporting free trade, he added.

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