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Press Release 20140314

Friday, March 14, 2014

Key Points of Chinese Premier Li Keqiang's Press Conference after the Closing Meeting of the Second Annual Session of the 12th National People's Congress

I. On the GDP Growth Target of 7.5%

The Chinese Government set this year's GDP growth target at about 7.5%. What we care about is to ensure employment, improve people's lives and increase urban and rural incomes. Each year we need to add over 10 million urban jobs and leave room for about six to seven million rural migrant workers to come to get employed in cities. Therefore we need appropriate GDP growth. But the Chinese Government is not preoccupied with GDP growth. The GDP growth we want is one that brings real benefits to our people, helps raise the quality and efficiency of economic development and contributes to energy conservation and environmental protection.

II. On Debt and Financial Risks

The Chinese Government pays very high attention to the financial and debt risks. Last year, China conducted a comprehensive audit on government debt. The result shows that the risks are on the whole under control. Moreover, the debt to GDP ratio is below the internationally recognized warning line, and most of the debt takes the form of investment. But the government will not overlook potential risks. We are going to intensify regulatory steps, put those debts under budgetary management over time and enhance the oversight of financing vehicles.

As for default of financial products, certain individual cases of such defaults are hardly avoidable. What we should do is to step up monitoring, promptly handle relevant situation and ensure that there will be no regional and systemic financial risks.

III. On Comprehensively Deepening Reform

The comprehensive deepening of reform will be carried out in all areas of China's economic and social development. The ultimate goal of reform is to energize the market and stimulate creativity of the society. The government needs to perform its duties well to bring benefits to the people.

This year, the Chinese Government will continue to streamline administration and delegate power to let the market fully play its role in an effective and well-regulated manner. We will take fiscal, tax and financial reforms as priorities. New steps will be taken to ease the tax burden on micro and small businesses to boost market vitality. We will pursue structural reform to boost structural adjustment. In this area, we will deepen reform of state-owned enterprises, vigorously develop a mixed-ownership economy and ease market access, especially in the service sector, such as health care, old-age support and financial services to boost market competition. The crucial thing is to ensure that all reform measures will be fully implemented.

IV. On Fighting Pollution

The Chinese Government will declare war against smog and pollution as a whole. What we mean is that we are going to declare war against our own inefficient and unsustainable model of growth and way of life. Last year, the Chinese Government issued a ten-point plan of action on the prevention and control of air pollution. China now conducts PM2.5 monitoring in 161 cities across the country, which is the most extensive scope among all developing countries. This year we will take further measures. For example, we have set the target of cutting energy intensity by 3.9% on top of the 3.7% reduction we achieved last year. This is equivalent to cutting coal burning by 220 million tons.

In fighting pollution, we need both tough measures and tough regulations. The government will severely punish those illegal emitting activities which harm both nature and human health. And those overseeing agencies which turn a blind eye to polluting activities and fail to perform their overseeing duties will be held accountable.

V. On China-US Relations

The China-US relationship, in essence, is a relationship between the largest developing country and largest developed country in the world. Last year, President Xi Jinping and President Obama had a meeting in California and reached the important consensus of building a new model of major-country relationship between China and the United States. This relationship has the defining feature of non-conflict, non-confrontation, mutual respect and win-win cooperation.

China and the United States are different in history, culture and stage of development. So it's only natural that these two countries have some differences and there are also some frictions in their cooperation. But these are pains amidst growing cooperation. As long as the two sides respect each other's core interests and major concerns, properly manage differences and engage in equal consultations, in particular, continue to expand their converging interests, they can further raise the level of this relationship.

The common interests between China and the United States far outweigh their differences. Trade between the two countries reached over 520 billion US dollars last year.The two sides are now in negotiation of a bilateral investment treaty. There is much more for both sides to do to further unleash the potential of Sino-US cooperation, and both sides need to make the most of complementarities. As the Chinese saying goes, wise people seek common interests while the unwise focus on their differences. So China and the United States need to focus more on common ground in pursuit of long-term benefits.

VI. On China's Relations with Neighboring Countries

To achieve the modernization of China requires a peaceful and stable neighboring and international environment. We also have an unshakable will in safeguarding China's sovereignty and territorial integrity. These two points are both for the sake of upholding stability and creating a favorable environment for China's development.

As early as 60 years ago, China and some of its neighbors had jointly initiated the Five Principles of Peaceful Coexistence. When neighbors interact with each other, it's only natural that sometimes they will run into problems of one kind or another. But as long as they respect each other, properly manage differences and pursue mutual benefit, there will be harmonious sounds instead of jarring noises.

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