China’s Premier Li Keqiang has said China’s economic growth will stay on track, as the annual meeting of parliament draws to a close, BBC reports. The National People’s Congress ended with the adoption of a new five-year plan for the economy, aiming for 6.5-7% growth a year by 2020. Measures include cutting high debt, streamlining state-owned enterprises, and reforming financial markets.
China has been facing a period of slower growth and market volatility. The plan, laid out by Communist Party leaders, received unanimous approval from delegates at the largely rubber-stamp NPC. At his annual press conference later, Mr Li stressed the importance of reforms to economic vitality.
He acknowledged there would be job losses as reforms were made to state-owned enterprises, particularly in the steel and coal industries, but said there would be no mass redundancies. The economy would “not suffer a hard landing, we have full confidence in the bright future of the Chinese economy”. Concerns have been swirling about the health of China’s economy, which expanded at its slowest pace in 25 years in 2015.
Reports in recent week have suggested China may make up to six million state workers redundant over the next few years as part of its shift away from a manufacturing to services-based economy. In February, the central government launched a $15.3bn (£10.8bn) fund aimed at relocating workers who lost their jobs as part of China’s supply-side reforms.
Aside from slumping exports, the stock market saw trillions of dollars lost last summer following unprecedented volatility. However, the government is still looking to reform its financial markets and increase the use of its currency, the yuan. Mr Li said there were plans to develop a stock-trading link between Hong Kong and Shenzhen this year, expanding upon a program that already exists between Shanghai and Hong Kong.
To reduce currency volatility and capital outflows, China is also planning to impose a tax that may curb excessive speculation.