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Premier Li: China needs to policies that boost economy

21 Nov 2019 11:24 AM

China needs to make better use of its various political tools to boost the economy as growth slows near its lowest level in three decades, and a partial trade deal with the United States remains elusive, said Chinese Premier Li Keqiang Tuesday.

Li told reporters after a meeting with the World Bank and IMF presidents that monetary policy needs to increase pressure on the development of the real economy, especially small and medium-sized enterprises, and said China will use "efforts through all channels" to lower real interest rates.

"China's main interest rate is just over 4% for one year, so we still have room to deal with the expansion of monetary policy," former central bank governor Zhou Xiaochuan said today in a separate event in Beijing.

The interest rate on loans, China's main lending rate, was cut again on Wednesday to reduce the company's financing costs and support the economy, which has been hit by slowing demand and US trade tariffs.

The Chinese economy has maintained stable performance this year, and the government is confident that it will achieve the key social and economic goals for 2019, Li said, adding that Beijing will continue with a proactive fiscal policy and prudent monetary policy.

Growth in the world's second-largest economy slowed more than expected to 6.0% on yearly basis in the third quarter, the weakest pace in nearly 30 years.

The government has vowed not to open the door to huge incentives as it has in the past and has largely relied on a description of increased infrastructure spending, tax cuts and frequent liquidity injections to ease the current slowdown.