China will keep its economic growth within a reasonable range and achieve this year’s growth target despite challenges, the state-run Xinhua news agency said on Tuesday, amid an intensifying trade war with the United States, Reuters reports.
The world’s second-largest economy has already felt the pinch from Beijing’s multi-year deleveraging drive that has driven up corporate borrowing costs and delayed government projects.
“We must do a good job in stabilizing employment, finance, foreign trade and investment, and expectations,” Xinhua said, citing a statement released after a meeting of the Politburo, a top decision-making body of the ruling Communist Party.
China’s economy faces some new problems and new challenges, including “significant changes in the external environment”, Xinhua cited the Politburo meeting - chaired by President Xi Jinping - as saying.
“We must seize the main contradictions and take targeted measures to solve them,” it was quoted as saying.
China is able to win the battle against various economic risks and challenges and needs to maintain confidence, state radio quoted Xi as saying.
Economic growth slowed slightly to 6.7 percent in the second quarter, but was still above the official 2018 growth target of about 6.5 percent.
However, the trade row with Washington, a slowing domestic property market and reduced outbound shipments have sharply increased the risks to China’s economic outlook.
China will better balance its financial risk prevention and support for the real economy, maintaining its deleveraging drive but paying attention to its pace and intensity, it added.
It will ensure the fulfilment of the annual economic growth target, while maintaining a proactive fiscal policy and a prudent monetary policy to ensure ample liquidly, the agency said.
“Fiscal policy should play a greater role in expanding domestic demand and promoting structural adjustments,” the Politburo was quoted as saying.
Last week, China’s cabinet pledged to make fiscal policy more proactive to help tackle external uncertainties without resorting to strong policy stimulus.
China will step up infrastructure investment in targeted areas, support innovations and lower corporate costs, it added.
Beijing plans to put more money into infrastructure projects and ease borrowing curbs on local governments to support the economy, Reuters reported exclusively, citing policy sources.
The Politburo meeting also pledged to “resolutely curb” housing price rises and speed the process of establishing a long-term mechanism for the property sector, the agency said.