New | In brief: Premier Li Keqiang on China’s growth target, US elections, and the future for Hong Kong and Taiwan
We bring you the key takeaways from the Chinese premier’s two-hour-long press conference
Hong Kong
“I have confidence in a bright future for Hong Kong.”
Asked “what’s wrong with Hong Kong”, China’s Premier Li Keqiang did not touch on the 2017 chief executive election or the Mong Kok riot earlier in January. Hong Kong had to put in its own efforts to develop, Li said. It could also take advantage of mainland China’s economic development, he added.
“The central government will give full support to any proposals from the SAR government that help maintain Hong Kong’s long-term prosperity and stability and contribute to the well-being of the people of Hong Kong. I have confidence in a bright future for Hong Kong,” he said. “Hong Kong’s economic growth of 2.4 per cent last year was not low.”
China’s economy
“It’s impossible for me to [agree] that China is unable to meet the decided target.”
Li said China’s pro-growth measures so far, including cuts in interest rates, should not be labelled as quantitative easing. The country’s growth was on track, he said.
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“It’s impossible for me to side with you [and agree] that China is unable to meet the decided target,” Li said, when asked if China might fail to meet the growth target. “China’s economy will still face small and short-term swings, but if growth falls out a reasonable range, we have innovative macro tools to maintain stability of growth.”
While the world’s second-largest economy was presently facing difficulties, hopes for it were bigger than those difficulties, the premier said. China had the policy reserves to handle headwinds from the global economic slowdown. “As long as we stick to reform and opening up, China’s economy will not see a hard landing,” he said.
Shenzhen-Hong Kong stock connect
“We ... will try to launch the Shenzhen-Hong Kong stock connect programme this year.”
Li said: “We are in close communication with the Hong Kong government and will try to launch the Shenzhen-Hong Kong stock connect programme this year. Currently, the relevant authorities in mainland China and Hong Kong are in intensive consultation.”
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The premier added that the stock connect would benefit both parties. Fang Xinghai, a vice-chairman with the China Securities Regulatory Commission, said the link was expected to be launched in the second half of the year.
Li also said China would continue to build up a multi-layered capital market, although he did not touch on the strategic emerging board.
Financial regulation
“We have to open our eyes wide [to financial risks].”
Li said China had to ensure full coverage of its financial system, as there were many innovative financial products and the country could not afford to leave any area uncovered. He did not elaborate much on the topic, though. “In short, we have to open our eyes wide [to financial risks],” he said.
US election
“No matter who gets into the White House, the underlying trend [of stable Sino-US ties] will not change.”
In a polite response to certain China-bashing comments from the United States’ presidential candidates, Li said the result of polls would not affect Sino-US relations. “The US election is lively and has caught the attention of many. No matter who gets into the White House, the underlying trend will not change,” he said. “China-US relations have always been moving forward. I believe that is the underlying trend.” Sino-US trade ties had always been “win-win” for both countries, the premier said. “American businessmen know it very clearly in their hearts.”
Lay-offs
“We must ensure that the rice bowls of workers are still there, or we must give them new rice bowls.”
As angry Chinese coal miners took to the streets to protest unpaid wages this week, Li said China would try to avoid mass lay-offs in its economic restructuring process. “We will press ahead to reduce capacity, but we must ensure that the rice bowls of workers are still there, or we must give them new rice bowls,” he said. The central government had already set aside 100 billion yuan (HK$119 billion) to help laid-off workers, and Beijing was ready to boost the fund if necessary, he said.
Pensions
“Some places are having difficulties in paying pensions, but it is a problem for one place and a pressing issue for a particular time point.”
For the first time, Li admitted that some local governments were facing difficulties in paying out pensions. In China’s patchy pensions system, provincial-level governments are in charge of paying pensions. The premier said the problem was temporary and restricted only to specific regions. “As a matter of fact, some places are having difficulties in paying pensions, but it is a problem for one place and a pressing issue for a particular time point,” he said.
Taiwan
“I remain optimistic about the prospect of cross-strait relations; blood ties cannot be severed.”
On Beijing’s relations with Taiwan after the Democratic Progressive Party’s Tsai Ing-wen won the election late last year, Li said anything could be discussed as long as both sides adhered to the principle of “One China”.
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“As long as Taiwan adheres to the foundation of the 1992 Consensus and recognises that Taiwan and the mainland belong to the same China, anything can be discussed,” Li said. “I remain optimistic about the prospect of cross-strait relations; blood ties cannot be severed.”
Li added that the government had issued a document guaranteeing that preferential policies given to Taiwanese businessmen on mainland China would be maintained. Beijing would introduce more such policies, but the precondition was the Taiwan government had to recognise the “one China” principle and that Taiwan was an inalienable part of China.
