UNITED24 - Make a charitable donation in support of Ukraine!

Weapons of Mass Destruction (WMD)

Global Times

Premier Li calls for increased urgency in taking new measures to keep economy stable

Global Times

By Global Times Published: May 18, 2022 11:00 PM

Chinese Premier Li Keqiang on Wednesday called on local officials to increase the sense of urgency and take as many feasible new measures as possible in May to keep the economy operating in a reasonable range in the first half of the year and the full year, while vowing that the country will safeguard employment and people's livelihood by means of stabilizing market entities, China Media Group reported.

Li made the remarks at a meeting with officials from 12 provinces in Southwest China's Yunnan Province. The meeting, which is focused on the current economic situation, comes as China continues to battle new economic pressure arising from recent outbreaks of Omicron cases in multiple cities. In particular, China's financial and logistics hub Shanghai was forced to halt economic activities for nearly two months after a surge of Omicron cases. The city is starting to resume work and production.

According to the Premier, some of China's economic indicators turned evidently weaker since March, particular in April, and China's economic downward pressure is increasing further. The county should face up to difficulties and cope with economic challenges, while also seeing that domestic commodity prices are stable and there is still policy space to cope with challenges.

Li said that China should increase macroeconomic policy adjustment. Policies that have been arranged in the Central Economic Work Conference and Government Work Report should be basically implemented in the first half of this year.

Local governments and various departments should also roll out as many new measures as possible in May, in order to make sure that the domestic economy operates within a normal range in the first half of this year and for 2022, the Premier said.

In particular, Li stressed that China should use reforms to solve problems in economic development. One aspect he mentioned is that China should focus on stabilizing employment and safeguarding people's livelihood by stabilizing market entities. To support businesses, China will implement policies such as tax reimbursement and guide financial institutions to postpone loan interest rate payments for smaller enterprises.

Hu Qimu, chief research fellow at the Sinosteel Economic Research Institute, interpreted the official focus on stabilizing market entities as a reflection of policy inclination toward smaller companies, as private companies account for more than half of the country's GDP and tax revenues, while employing the majority of China's workforce.

As a result, stabilizing private economy, especially smaller companies are key not only to bolstering economy, but also to safeguarding social security, Hu said.

Chinese officials have repeatedly stressed measures to support smaller companies. Xu Xiaolan, deputy head of the Ministry of Industry and Information Technology (MIIT), vowed on Wednesday to better implement policies aiming at helping medium and small-sized companies relieve their burden, as well as stressing a number of key missions for supporting those companies such as increasing capital support.

One day after senior officials on Tuesday reaffirmed support for the country's platform firms, Li also mentioned on Wednesday that China will support platform economy and digital economy companies to seek funds via domestic and overseas IPOs according to laws and regulations.

Hu said that the government is sending a strong signal to support digital economy with the goal of enhancing market confidence and expectation, after there's a lot of uncertainty and pessimistic mood surrounding the digital economy sector.

"It is a sign that China is determined to create an open, fair market environment for digital economies," Hu told the Global Times.

Join the GlobalSecurity.org mailing list