China has resilience to keep economy growing: Premier

China has resilience to keep economy growing: Premier

China has the potential, resilience and room to keep its economy growing within a rational range, Premier Li Keqiang said at a press conference at the end of the annual session of the National People's Congress, China's top legislature, on Sunday.

Premier Li answered 17 questions from Chinese and foreign media covering almost all fields, with the focus on economy and reform.

It is easy to realise the 7 per cent growth, a lower target than previous years, given China's huge economic size, Premier Li said. "We should pay more attention to the quality and efficiency of the economy, so as to ensure the steady and healthy economic growth in the long run."

Premier Li allayed the foreign reporters' worries on the future of Chinese economy, and said the government will strengthen its well-targeted macro-control policies to keep the steady economic growth, guaranteeing enough jobs be created and price inflation be checked.

The rational-range economic growth, high saving rates and reform of government debt platform and the financial sector ensure that the government has the ability to avoid regional and systematic financial crisis, despite the slight increase of bad loans, which is still lower conventional international standard.

"We allow some individual cases of financial risks to happen, and they should be settled through market-based methods," Li said.

Li denied that China has entered or exported deflation.

"China is actually at the receiving end of deflation, and 'deflated' by the drop in staple commodity prices in the world," Li said.

"Chinese government still has plenty of tools at its disposal … to keep a delicate balance between restructuring and growth," said Li. "There is mounting downward pressure and multiple challenges and we should keep a big sight in mind and make the correct move at the same time.

Reform has been the key word in Li's three press conferences at the NPC's annual session as premier since 2012. The deepening of reform will necessarily touch the interests of some people, Li said. "Giving up power is not to trim finger nails, but cut one's own hand."

"The government's self-imposed reform is still there and acute. Streamlining the government and delegating powers to the market and society can boost the vitality of the market and the economy," Premier Li said responding to a question on reform and economy raised by Bloomberg.

Chinese government cut one third of its administrative approvals in two years, and the number of market subjects increased by nearly 50 per cent year-on-year last year.

The government reform must be finished. It is useless to release the hand break while keeping the foot break, Li said.

To put the power under effective supervision, Premier Li urged the provincial governments to issue their "negative lists" of government's responsibility and power this year, and the city and county governments will have the lists in the next year.

Power abuse is a major issue in the government's reform.

"The key points of fight against corruption are to implement the rule of law, reform the institutions and improve the supervision and transparency of powers," Li said answering Beijing News' question on anti-corruption. "Apart from corruption, the inaction and irresponsible officials must be addressed."

Li also faced difficult questions on government's work, such as the environmental protection.

"The government has made great efforts to clean the air. But the effects are still far from the people's expectation," Premier Li said.

"The new Environmental Protection Law must be implemented effectively … There should not be power superior to the law, or interference in the process, and there should be a strict accountability system to supervise the environmental watchdogs."

The energy saving and cutting emission targets are written together with the other key targets of the economy and society in this year's Government Work Report. Li emphasised that it takes time and joint efforts of the whole society. "If the environment cannot be changed soon, the people can change their way of behaviours."

In his reply to a question on housing market from the Financial Times, Premier Li Keqiang welcomed foreigners to buy homes in China. He said housing is not only an economic issue, but also concerns people's livelihood, vowed to fulfil the government's responsibility to ensure the poor people have houses to live in.

"The local governments should be responsible for the macro-control of local housing market … the central government hopes to see a steady and healthy growth of the housing market in the long run," Premier Li said.

The vitality of economy also comes from innovation, job creation and starting new businesses.

And Li openly expressed his support for e-commerce in China. He said: "I like promoting new forms of business of e-commerce and related industries, because they create jobs, and stimulate consumption."

The aging of population has already been a concern for Chinese economy. Li said the government is assessing the effects of its population policy reform, taking into account the social and economic situations. "But the policy adjustment must be made according to the laws," Li noted.

The first foreign-affair question was on Sino-Japan relations.

After expressing China's principle on peace and history, Li said the root cause of the soaring bilateral ties is the different attitudes to history.

A state leader should not inherit the legacy of history, but also the historical responsibility, Li said.

"The Japanese people are also victim of the war … This year is the 70th anniversary of the victory of Anti-Fascist War is both a test and an opportunity for Japan." If the Japanese leaders can hold a responsible and constant view on history, there will be possibility and room for improvement of bilateral ties in political and economic realms.

Refuting the claim that China has surpassed the US as the world's largest economy through "taking a free ride of the US", Li said China's average per capita GDP is only ranked 80th in the world, and China still has 200 million people living under the World Bank's poverty line of 1.25-dollar (S$1.75) a day. "China is still in every sense a developing country."

"With such a big size as China, it is impossible to take a free ride of anybody else. China is actually pushing the car together with the other countries," Li said. "The Sino-US relations are between the largest developing country and the largest developed country."

China and the US have more common interest than divergences. The two sides are negotiating bilateral investment treaty, which will break the ceiling of the bilateral ties, and send out the message that the countries will co-operate more closely with each other, Li said.

As for questions on Hong Kong and Taiwan, Li reiterated Chinese government's constant stance, principles and policies.

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