Risks still fac­ing the econ­omy

Ex­pan­sion con­tin­ues to ex­pe­ri­ence heavy down­ward pres­sure, key Party meet­ing told

China Daily (USA) - - TOP NEWS - By XIN ZHIMING andWANG YANFEI Con­tact the writ­ers at xinzhim­ing@chi­nadaily.com.cn

China’s eco­nomic growth still faces heavy down­ward pres­sure, a meet­ing of the Po­lit­i­cal Bureau of the Com­mu­nist Party of China Cen­tralCom­mit­tee presided over by Gen­eral Sec­re­tary Xi Jin­ping heard on Tues­day

There are “some risks and po­ten­tial threats that de­serve high at­ten­tion”, the gath­er­ing de­cided.

Par­tic­i­pants agreed that in the se­cond half of this year, the na­tion should con­tinue to press ahead with sup­ply-side struc­tural re­form, Xin­hua News Agency re­ported.

The re­port also said a proac­tive fis­cal pol­icy and pru­dent mone­tary pol­icy would be adopted, and var­i­ous taxes and fees low­ered to an­chor eco­nomic growth and re­solve po­ten­tial fi­nan­cial risks.

The meet­ing also de­cided that re­form of State-owned en­ter­prises and fi­nan­cial sec­tors should be deep­ened, which is the key to the coun­try’s ef­forts to cut ex­ces­sive pro­duc­tion ca­pac­ity.

Ef­forts should also be made to push ur­ban­iza­tion in an orderly man­ner and help farm­ers to set­tle in cities to en­cour­age con­sump­tion and ad­dress the econ­omy’s weak points.

La­bor mar­ket flex­i­bil­ity should be in­creased, as­set bub­bles re­duced and taxes cut to re­duce over­all eco­nomic costs, ac­cord­ing to the Xin­hua re­port.

Pol­i­cy­mak­ers should guide mar­ket ex­pec­ta­tions of the econ­omy prop­erly by adopt­ing sta­ble macroeconomic poli­cies and should im­prove pub­lic con­fi­dence in the coun­try’s de­vel­op­ment through im­ple­ment­ing ma­jor re­form mea­sures, it was de­cided.

Pri­vate in­vest­ment should be en­cour­aged and a level play­ing field cre­ated for all types of en­ter­prises, the re­port said.

Ac­cord­ing to a re­port by econ­o­mists at in­vest­ment bank UBS, China’s eco­nomic growth mo­men­tum could soften in the se­cond half. But pol­icy sup­port will be in­ten­si­fied inanat­tempt to an­chor growth, they said.

LiangHaim­ing, chief economist at Bei­jing-based think tank the China Silk Road iVal­ley Re­search In­sti­tute, said, “China faces great pres­sure from the eco­nomic down­turn.”

Xi said that de­spite the eco­nomic chal­lenges it faces, China has made some head­way in eco­nomic restruc­tur­ing and fos­ter­ing new growth en­gines du­ing an­other meet­ing onMon­day.

Mean­while, the State Coun­cil re­leased a guide­line on Tues­day on re­form of State-owned en­ter­prises.

This re­quires con­trol of some key in­dus­tries con­cern­ing na­tional se­cu­rity and the coun­try’s “eco­nomic life­line” to be strength­ened.

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