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“Inflation under control”, no need to worry, says a confident Wen
In an unusual move for a Chinese leader, Wen pens an opinion piece on the Financial Times. In it, he tries to be reassuring, saying that “price level is within a controllable range” and that China is in control of its economic growth. However, many continue to have doubts about the central kingdom’s stability.
Beijing (AsiaNews/Agencies) – China’s policy of price controls have kept the “overall price level [. . .] within a controllable range” and Beijing has been able to “rein in inflation and sustain its rapid development,” Chinese Prime Minister Wen Jiabao said in an opinion piece published in the Financial Times, an unusual step for a Communist leader who will travel to several European countries next week.
For Wen, inflation is bound to slow down. Against those who are concerned “whether China can rein in inflation and sustain its rapid development,” his answer “is an emphatic yes.”
“China has made capping price rises the priority of macroeconomic regulation and introduced a host of targeted policies. These have worked. The overall price level is within a controllable range and is expected to drop steadily,” Wen wrote.
“Imports are growing fast,” he added; yet he is “confident that price rises will be firmly under control this year” as China continues “to work with other countries with common responsibilities” to “make concerted efforts to strengthen the co-ordination of macroeconomic policies”.
For the Chinese leader, countries should “promote strong, sustainable and balanced growth of the global economy,” as well as “fight protectionism, improve the international monetary system and tackle climate change and other challenges.”
He went onto say that China’s response to the crisis was to stimulate domestic demand and the real economy, insisting that his government would continue economic policies of “structural adjustment”.
However, many doubts remain over China’s economic stability. Every year, tens of thousands of episodes of social protest take place in response to wage restrictions and inflation.
Hence, Wen’s answer to such doubts, in an internationally renowned newspaper, is designed to reassure foreign investors about China’s worrisome domestic situation.