BEIJING – Job creation remains at the heart of China’s economic strategy even as the world’s second-largest economy faces fresh challenges ahead, including its own slowing growth, Premier Li Keqiang told the press on Monday (Dec 6).
More employment opportunities for the Chinese people will create a more vibrant economy and provide more revenue streams for the government, he said.
Key to China’s strategy will be to support the financing of its small and medium-sized enterprises (SMEs), Mr Li said in a late-night media briefing after an annual meeting with the World Bank, International Monetary Fund (IMF), and the World Trade Organisation (WTO), among others.
China’s SMEs employ a majority of its workforce.
Data released by the National Bureau of Statistics last month showed that China had hit its annual target of creating 11 million new jobs in urban areas in the first 10 months of this year.
Earlier on Monday, the central bank also said that it would cut financial institutions’ reserve requirements by 50 basis points, starting from next Wednesday.
The central bank’s move is expected to release about 1.2 trillion yuan (S$257.7 billion) into the economy, with the hopes of spurring lending and business growth.
Mr Li’s comments to the press come after a two-hour “1+6” roundtable discussion with the heads of six international organisations: World Bank president David Malpass, IMF managing director Kristalina Georgieva, WTO director-general Ngozi Okonjo, International Labour Organisation director-general Guy Ryder, Organisation for Economic Cooperation and Development secretary-general Mathias Cormann and Financial Stability Board chairman Klass Knot.
The leaders pointed to how growth among different countries has been uneven so far, and that China as a major world player can help ensure a smoother global recovery.
The persistent Covid-19 pandemic, with variants continuing to evolve, has widened global inequality, they added.
On Monday, the leaders and Mr Li reaffirmed their commitment to defend multilateral trade, with China promising to open up further to foreign investment.
IMF’s Dr Georgieva told the press on Friday that China had made a “truly remarkable recovery” from the Covid-19 pandemic, but that its growth had slowed towards the end of this year.
China’s moves to push economic growth – including the central bank’s latest reserve rate cut – will help global economic recovery as well, she added.
China’s GDP expanded by 2.3 per cent last year despite the devastating effects of the pandemic, making it the only major economy in the world to post an expansion.
Worries over China’s economic health grew in October when growth between July and September this year came in at 4.9 per cent, slightly lower than economists’ expectations of 5 per cent in a Bloomberg poll.
In the third quarter, energy shortages, fresh Covid-19 outbreaks and a more sombre property market had dragged on the economy, which had grown 9.8 per cent as of September, according to official figures.
Analysts expect China to roll out measures next year to support its fast-cooling property sector, which contributes up to a third of its economy.
Overall, China’s economic growth is expected to come in at 8 per cent this year, higher than the target of “above 6 per cent” announced during the country’s top legislature meeting in March.