China to "Implement Active Fiscal Policy" in Second Half of the Year

Rapid Surge in Global Commodity Prices and Spread of Variant Viruses Create Complex Domestic and International Environment
Li Keqiang, Chinese Premier, to Support Real Economy with Corporate Funding and Employment Expansion

[Asia Economy Beijing=Special Correspondent Jo Young-shin] Li Keqiang, Premier of China, stated that the domestic and international environment remains complex and uncertain due to COVID-19 and other factors, and announced plans to support the real economy through proactive fiscal policies and sound monetary policies in the second half of the year.

According to China's state-run Xinhua News Agency and People's Daily on the 14th, Premier Li held a roundtable meeting with economic analysts and businesspeople in Beijing on the 12th to explain the economic management policy for the second half of the year.

[Image source=Yonhap News]

Premier Li diagnosed the Chinese economic situation by saying, "The Chinese economy is sound, but the sharp rise in international raw material prices is increasing costs for companies, making difficulties for small and medium-sized enterprises even greater." He added that confidence in China's economic development is necessary, but challenges must also be faced. This is interpreted as a preemptive response to the global economic recession caused by the spread of the COVID-19 Delta variant.

Premier Li stated that the focus of economic policy in the second half of this year will be on employment. He said, "We will support the real economy through proactive fiscal policies and sound monetary policies," and promised to ensure that manufacturing companies, including small and medium-sized enterprises, do not face difficulties in financing. He mentioned the issuance of special bonds by local governments. Premier Li also ordered the promotion of employment for college graduates and migrant workers, as well as the advancement of basic livelihood projects.

Earlier, the People's Bank of China, the central bank, lowered the reserve requirement ratio by 0.5 percentage points, expanding the additional lending capacity of Chinese financial institutions by 1 trillion yuan (approximately 177 trillion Korean won).

Premier Li promised, "We will invigorate market entities through strong measures of reform and opening-up," while strengthening supervision against monopolies and unfair competition and actively developing new industries such as e-commerce.

The roundtable meeting was attended by Han Zheng, a member of the Standing Committee of the Political Bureau of the Communist Party of China and Vice Premier, as well as Vice Premiers Sun Chunlan, Hu Chunhua, Liu He, and He Lifeng, Director (Minister) of the National Development and Reform Commission, enhancing the credibility of the policy.

This content was produced with the assistance of AI translation services.