Full Text: Premier Li Keqiang Meets the Press (5)

Straits Times: Premier Li, my question is about China's economy. China has set a lower GDP growth target this year of around 7%. Some say that it signals that Chinese economy has entered what they call a "new normal" of slower but better quality growth. What are the benefits knowing there are also downsides of slowing Chinese economy? Can you tell us how this new normal will affect China and the world? How should we view this and can we have the confidence that China is still committed to this new normal and can mange it well?

Li Keqiang: China's economic development has entered a new normal. This year we have set the GDP growth target at approximately 7%. The GDP growth target has been adjusted downward, but it will by no means be easy to meet this target. Because China's economic aggregate keeps expanding and now the size of the economy is valued about 10 trillion US dollars. So a seven percent increase in today's economy is equivalent to the economic aggregate of a medium-sized country. We want to upgrade China's economy to a medium-high level of development and pursue a growth with improved quality and performance. This will help maintain China's growth at a medium-high speed and lay a more solid foundation for us to achieve modernization. It will also be China's big contribution to global economic growth.

I sense some elements of concern in your question about China's economic growth and when the journalist from Bloomberg asked his questions, there was also such a worry about slowing growth in China. I have said on many occasions that under this new normal, we need to ensure that China's economy operates within a proper range. And if the growth speed comes close to the lower limit of the proper range and affects employment and increase of people's income, we will step up targeted macro economic regulation to boost the current market confidence while maintaining the continuity of our macro economic policies to anchor long-term market expectations. The good news is that in the past couple of years, we did not resort to massive stimulus measures for economic growth, and that has given us ample room to exercise macro economic regulation and we still have a host of policy instruments at our disposal.

The latter part of my remarks is about a hypothetical situation. At the same time, I recognize that there is considerable downward pressure on China's growth and we still face multiple risks. This requires that the government strike a proper balance between maintaining steady growth and making structural adjustments. In Weiqi, a chessboard game invented by the Chinese, one needs to both plan on the big side and get key moves right. When it comes to the economy, we must meet both ends of maintaining steady growth and making structural adjustments. And this way, we can get a handle on the big situation. This requires that we have vision, perseverance and courage. I have confidence that with joint efforts, we are able to maintain the long-term positive fundamentals of the overall Chinese economy.