Chinese premier underlines reform in promoting sustainable growth

Chinese Premier Li Keqiang on Monday underscored the role of reform in promoting sustainable growth, pledging to keep the economy from big fluctuations and maintain steady performance.

To achieve sustainable and healthy development, the authority should stick to rebalance the economy while keeping growth, employment and inflation within the reasonable range, Li said at a meeting in Lanzhou, attended by provincial heads in the country's western regions.

When the economy is heading towards its targeted limits, reform is needed to coordinate the policies and "make precise moves" to maintain steady growth, he said.

"The major task and targets of the government is to achieve a sustainable economy, improve people's lives and promote social equity," he said.

With the global economy still in arduous recovery, the domestic economy has achieved progress, but some much-accumulated conflicts have loomed large, he said.

As China's economy posted a prolonged slowdown in the past two years, the government was resolved to rebalance its outdated growth model that is overly reliant on investment and exports.

The government must coordinate economic growth and improve people's lives and make tangible benefits for people, Li said.

"Fundamentally, the government must rely on reform to release the utmost benefits, spur market and social vitality, and enhance domestic potential to promote long-term sustainable and healthy development," he said.

Despite the protracted slowdowns, Chinese authorities have so far refrained from initiating a massive stimulus program to lift the economy and allow leeway to proceed with structural reforms for the long-term good.

Since taking office in March, China's new government has announced concrete reform plans, including delegating administrative power to lower levels and easing controls in the financial sector.

On Monday, China's central bank governor Zhou Xiaochuan said the economy will not post persistent slowdowns, indicating the bank is ready to free long-awaited deposit interest rates, a key step to fully liberalize the financial market.

On July 19, the central bank announced lifting controls on bank lending rates, in a clear signal of the government's determination to push forward market-oriented reforms.

China's unbalanced economy is very much reflected in its wealth gap between rural and urban areas, and among different regions. But Premier Li singled out western regions as the biggest leeway areas for spurring more potentials, pledging to allowing differentiated economic policies for the region.

"Western areas should have more infrastructure projects. The railways, highways and hydro-power constructions there are needed to be improved further," he said.

The western provinces should also beef up fight against poverty, as more than half of the country's poverty-stricken population live there.

To achieve all of these goals, "We must rely on deepening reform and opening up, and improving the market economy with socialist characteristics," he noted.