Li Keqiang of China: "Sufficient Policy Capacity to Address Economic Challenges"

"Emphasizing the Need for China's Economy to Quickly Return to Normal Track"

[Image source=Yonhap News]

[Asia Economy Reporter Kim Hyunjung] Chinese Premier Li Keqiang stated that there is sufficient policy capacity to address the current economic challenges. The economic remarks of Li, China's 'number two,' have become more frequent recently.

On the 18th (local time), according to local media such as state-run CCTV and Xinhua News Agency, Premier Li said at an economic work symposium held in Yunnan Province, "We need to strengthen macro policy adjustments, and government agencies should implement policies as soon as possible." He added, "Policies confirmed at the Central Economic Work Conference and government work reports should also be completed in the first half of the year," emphasizing, "Efforts must be made to get the economy back on a normal track as soon as possible."

Regarding the recent deterioration of China's economic indicators, he expressed concern. He explained, "Due to the impact of unexpected factors such as new infectious diseases and changes in the international situation, the economic indicators in April weakened significantly," adding, "Difficulties in some industries and enterprises have worsened, and downward pressure on the economy has increased further."

As the government maintains its zero-COVID policy, retail sales (-11.1%) and industrial production (-2.9%) plunged to their worst levels since the pandemic began last month. The urban unemployment rate rose to 6.1%, and the youth (ages 16-24) unemployment rate hit a record high of 18.2%. Experts agree that it will be difficult for the Chinese economy to recover in the short term. On the same day, Goldman Sachs downgraded China's economic growth forecast for this year from 4.5% to 4%.

Premier Li also expressed his intention to take measures to ensure the healthy development and stability of the real estate market. Earlier, on the 15th, the central bank lowered mortgage rates for first-time homebuyers.

Additionally, at a symposium attended by heads of China's private enterprises and Vice Premier Liu He, he reiterated support for the "development and listing of digital economy companies." He also called for support for university students' employment and entrepreneurship, deferral of interest repayments on business loans, stable food production, and the maintenance of stable industrial and supply chains.