China will see 7.5 % growth; no need for bailout, says Li
Beijing: As Chinese economy continued its downward trend, Chinese Premier Li Keqiang expressed confidence that the 7.5 percent growth target for this year would be achieved without any massive bailout package to halt the slide.
China is capable of achieving its growth target of 7.5 percent this year without a massive stimulus program similar to the one launched during the 2008-09 global financial crisis, state-run China Daily quoted Li as saying at an economic conference here yesterday.
Li's comments comes in the wake of speculation that the government could come up with a bailout package like the massive USD 645 billion in 2008-09 to insulate Chinese economy from global financial crisis.
Li pledged to push ahead with economic restructuring while maintaining stable growth.
"We should not shift our policy orientation just because of temporary changes in economic indicators," he said at a meeting with economists and corporate leaders apparently referring China's current economic situation.
As per the latest data, China's economic growth slowed to 7.5 percent in the second quarter, a far cry from the double digit growth rates posted until two years ago.
It is inevitable to see economic fluctuations, Li said, adding that a major task of macroeconomic control is to avoid sharp fluctuations and keep economic growth within a reasonable range.
"The lower limit is to stabilise economic growth and maintain employment, while the upper limit is to prevent inflation," Li said.
Li said the economy has entered a new stage of development that prioritises restructuring and technological upgrading.
China's Central Economic Work Conference late last year set a goal for inflation this year of 3.5 percent, with a registered urban unemployment rate of below 4.6 percent.
"We are confident and capable of accomplishing the tasks given the current conditions," Li said, adding that it will require painstaking efforts.
He said small policy adjustments can be made if growth is considered too slow or sliding toward the government's acceptable limit and there are plenty of options for correction.
In view of slowing economic growth, economists at home and abroad have been speculating on whether China will take immediate measures to stimulate the economy.
But Li said the nation can tolerate the current (slow) economic growth rate and should improve the quality of growth.
He has been pushing for economic restructuring since taking office, which some economists say suggests the government is not in a hurry to launch fresh stimulus measures to revive an economy in a protracted slowdown.
Li said the economy is facing unprecedented complications, with the global economic recovery "twisted".
China should rely more on a structural transformation and technology upgrade, allowing the market to play a full role, focusing on innovation and improving people's livelihoods in an attempt to sustain stable and healthy economic growth in the long term, he said.
During the meeting, Li also called for high vigilance against the economy deteriorating beyond the acceptable limit.
Long Guoqiang, director of foreign economic relations at the State Council Development Research Centre, said, "There will be negative growth in exports in the second half of this year", because of slackened global demand, increased costs and a rising yuan.
Zhang Yuyan, a senior researcher with the Chinese Academy of Social Sciences, said economic growth is slowing but still remains at a reasonable level.
"A seven percent growth rate is acceptable," Zhang said.