The lowest growth for 25 years. Disquiet about Trump and Brexit. The problems of economic reforms: speculative bubbles, over-production, closure of SOEs. Plans for reduction of 50 million tons of steel; 150 million tons of coal. New infrastructure. He Lifeng: The government has "confidence and resolution."
Beijing (AsiaNews) - In 2017 China thinks it can grow by 6.5%, taking into account the many uncertainties in its path. Premier Li Keqiang was speaking at the opening of the National People’s Congress being held in Beijing, in the Great Hall of the People.
Addressing the annual appointment of more than 3 thousand delegates of the Chinese parliament, the prime minister said yesterday that the country is facing "more complicated and more gray" challenges given several uncertainties in the global society. "World economic growth – he said - remains sluggish, while the de-globalization and protectionism are on the rise."
From here the prospects of very sober growth, when compared to those of the past. That of 6.5 is the lowest figure for 25 years.
Li Keqiang cited "uncertainties about the direction of the major economies and their repercussions" that could create instability. In short, the difficult trade relations between China and its major partner, the United States - which threatens a duties war on Chinese products - and the EU reeling from Brexit and other signs of division.
The challenges and uncertainties are also within the country. For years, experts and leadership have been convinced of the need for a reform of the Chinese economic model, overly reliant on domestic production and exports.
This reform should review and perhaps close many state-owned companies that are in fact dead, but are kept afloat to save jobs. Overproduction needs to be curbed production calibrated to market requirements; the problems of speculative bubbles in the housing sector addressed and the growth of the state debt curbed at local and provincial level.
Li said that the government intends to reduce the production of 50 million tons of steel and 150 million coal. It will put on hold or postpone construction or eliminate some coal plants to reduce the production of 50 million kw of energy, making room for "clean energy".
All this will cost in terms of jobs. Li Keqiang pledged that the government will give financial assistance and subsidies to workers laid off or help them find new employment. Li also promised that this year China will produce at least 11 million new jobs in cities, a million more than last year.
To create more employment, China will launch in new infrastructure: 800 billion yuan [around 109.5 billion of euro] in railway works; 1.8 trillion yuan [246.5 billion of euro] in roads and sea routes; 15 large hydroelectric projects and much more.
He Lifeng, a great friend and ally of Xi, also addressed the NPC. He was recently appointed head of the National Commission for Reform and Development, a group under the control of the President Xi Jinping presides over the economy's restructuring projects and the development model Chinese. He wanted to allay concerns about low growth figures, saying that the government has "confidence and resolution." He said that the growth of 6.5% will provide all necessary jobs. Each GDP growth point will guarantee at least 1.7 million jobs.