China to keep ‘targeted’ policy to support economy

日期:2014-08-28 08:09:29

China will maintain its “targeted” policy stance to keep economic growth on track, focusing on investment projects in bottleneck areas, the cabinet said on Wednesday.

The regular weekly State Council meeting, chaired by Premier Li Keqiang, also pledged to open up more projects in industries dominated by state monopolies to private investors.

“We will maintain targeted controls and use the long-term approach to ensure smooth economic and social development,” the cabinet said in a statement published on the central government’s website, www.gov.cn.

The government will roll out a number of projects in areas where more spending is needed, such as air- and water-pollution prevention, and clean-energy projects including wind power, hydropower and nuclear plants, it said.

Other areas will involve the construction of public hospitals, nursing homes and fitness centres, it added.

China will continue to cut administration bureaucracy to improve government efficiency, the cabinet said.

The central bank said on Wednesday it had raised its re-lending quota for the farm sector by 20 billion yuan ($3.26 billion) – the latest step to support a vulnerable part of the economy.

The government will step up fiscal support for poor regions and the farm sector.

A burst of policy stimulus steps since April lifted China’s annual economic growth to 7.5 percent in the second quarter – in line with the government’s annual growth target – from an 18-month low of 7.4 percent between January and March.

The government has relaxed monetary policy since April by easing controls in the property market, accelerating the construction of some infrastructure and relaxing reserve requirements for small banks to boost lending.

But a sharp drop in bank lending and fiscal spending in July, alongside tepid growth in investment and factory output, suggested the economy may need fresh policy support to cushion against the impact from a slowdown in the property sector.

Source: Reuters (Reporting by Aileen Wang and Kevin Yao; Editing by Richard Borsuk and Robert Birsel)

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