Just now, I heard the spokesperson say that today we have many journalists here. I heard that many of you arrived here 2 or 3 hours in advance. I thank you for your attention. Since we have limited time, I invite you to be direct with your questions.
CNN: President Trump has consistently criticized China for stealing U.S. jobs, manipulating currency exchange and not doing enough to maintain regional security. I understand that President Xi and Trump may meet as early as next month. What do you expect to receive from the U.S.?
Premier Li Keqiang: Your question reminded me of my speech last year in New York, when the U.S. presidential campaign was white hot. I was asked how the China-US relations would develop when a new U.S. president takes office. My answer was that whoever becomes the new U.S. President, China-US relations will keep moving forward despite the changing circumstances.
Soon after Trump became the U.S. president, he and President Xi Jinping talked on the phone. The two leaders re-emphasized the one-China principle. Many senior officials from both countries agreed to enhance China-US relations, too. The one-China principle is the corner stone of the China-US relations. This is the political basis on which China and the U.S. can continue to develop ties.
These days, the diplomatic departments are working on facilitating a meeting between the leaders of the two countries. Over the many decades since China and the U.S. established diplomatic ties, there have been many disagreements on employment, exchange rate and security issues, among other issues.
Facing these differences, we should continue our exchanges and sit down to talk calmly to enhance communication. China-US relations not only affect the interests of the two countries but also regional and global peace and stability; this is why we need to keep our ties moving forward.
In terms of trade issues, although China currently has a surplus, more than 90 percent of Chinese companies’ profits were taken by the United States. We have statistics showing that last year China-US trade and investment created more than one million jobs in the United States. But if we cannot reach an agreement at once, we can continue talking, which is what wise people do.
Recently I read a report by a reputable foreign think tank. It said that if trade wars broke out between China and the United States, those suffering first would be foreign-funded enterprises in China, particularly those funded by the U.S. Our hope on the Chinese side is that trade relations will move forward in the positive direction. Chinese people and Americans are both great peoples. We have the wisdom to control our differences, and also have the need and conditions to enlarge our common interests. Thank you.
China National Radio: The growth rate of the Chinese economy has slowed in recent years. This year, China has set its GDP growth target at around 6.5 percent. Will this adversely affect the global economy? Moreover, some people think that there are some risks in the Chinese economy, especially in the financial sector. Do you think that the Chinese economy can still remain the global economic engine driving the global economy while global economic growth is sluggish?
Premier Li Keqiang: We set this year’s economic growth at 6.5 percent. I’ve read foreign media that described it as China’s “moderate downward adjustment.” As a matter of fact, I should point out that 6.5 percent is not a low rate and won’t be easy to achieve; I once visited the Shaolin Temple with some foreign friends for a martial arts performance. I saw that the young monks can do a dozen of somersaults at one go very easily, but it would be quite a feat for adult monks to do even several – this is because of their different sizes. If we are able to achieve the 6.5 percent target this year, that will generate more economic output than last year, because this is achieved on the basis of 74 trillion yuan, or about US$11 trillion. This can generate 11 million jobs. It is in accordance with economic rules and this way we can focus more on the quality of China’s growth. I believe China will continue to be a strong driving force for the global economic growth.
As for risks, there are many uncertainties in the global economy and politics, and this can be a huge external risk. For China, lack of development will be the greatest risk. As long as we maintain a medium to high growth rate, we will be making a contribution to the global economy. Of course, we have some risks that we cannot neglect, for instance, financial risks as you mentioned. We are watching these risks closely and we will deal with them in time and with focused measures and won’t let them run rampant. Of course, I’ll point out that China’s financial industry is overall safe and does not have systematic risks. This is because we have a lot of tools at our hands. Our fiscal deficit is less than 3 percent, the capital adequacy ratio of commercial banks stands at 13 percent and the provision coverage ratio is 176 percent — all of these are better than many other countries, especially by the standards set by the international community. Therefore, we are able to avoid and prevent risks. We will buckle up during our medium- to high-speed ride, so as not to have a sudden risk, or a regional or systematic risk. Thank you.
Bloomberg: My Chinese is not good, sorry. The United States is shrinking its role in the global trade system, such as its withdrawal from the TPP. China seems to be poised to play a leadership role in global trade. You and President Xi Jinping both advocate free trade, an open economy and globalization. At the same time, China received criticism for unfair trade practices and measures for curbing opening speed. In the coming year, what will China do to make others believe that China is committed to free trade and open economy?
Premier Li Keqiang: First, in a process of globalization that is faced with controversy and has suffered setbacks in some respects, China regularly advocates economic globalization and free trade. It shows clearly that China will promote opening-up. Actually, globalization benefits each country, even though some problems arise in the process, such as in the sector of distribution. We need to tackle these problems rather than reject globalization. China is willing to cooperate with other countries to enhance the global governance system. Globalization is inseparable from the development of world peace. The closed door and beggar-thy-neighbor policies cannot resolve problems.
Like many other countries, China is the beneficiary of globalization as China is consistently advancing its opening-up. China’s priority is to realize its own development, but closing doors cannot realize that. We will continue to step up opening-up, which is a gradual process. In retrospect, we have been moving forward with the process over the past decades. Last year, China was still the largest recipient of FDI among all developing countries, with the figure reaching US$126 billion. According to the evaluation on business environment in China made by the World Bank, China jumped 18 places last year compared with 2013. We advanced the construction of Shanghai FTZ, expanded the coverage scale to 11 provinces, autonomous regions and municipalities, and will promote this across the whole country. We will hold the Belt and Road Forum for International Cooperation this year to put forward more opening-up measures. We proposed to establish a Free Trade Zone or make negotiations on investment trade treaties with many other countries. These are all two-way opening-up measures. We need to know that wider and deeper opening-up will bring about friction, but, it will ease. We are confident about the process. We will build up opening-up and attract more investment to share development opportunities with the whole world.
As for preserving global trade liberalization, it requires the joint effort of every country because the world belongs to everyone who lives in it. We always assume an open attitude to regional trade arrangements, including those established and those that are under discussion. We would also love to see progress in this regard. We will participate in and promote whatever facilitates trade liberalization. We Chinese understand that we have to seize with an open attitude the opportunities of globalization and not miss them, no matter what challenges we face. With regard to the arrangement on regional free trade, as long as China is involved and has the conditions to participate, we will assume an open attitude to promote it. We won’t meddle in others’ affairs. We won’t go beyond China’s regional scope to do things we shouldn’t. Thank you.
People’s Daily: Mr. Premier, for the past four years, we have seen that you have been highly focused on streamlining administration and delegating power. We’ve also seen in this year’s government work report that the goal of the current administration to cut the number of items that require government review by one third has been fulfilled ahead of schedule. So what about the remaining two thirds? Will this reform be pushed forward, and if so, what specific steps will be taken?
Premier Li Keqiang: The core of this reform is to transform government functions and balance the relations between the government and the market. This reform cannot be accomplished overnight. The goal of cutting the number of items that require government review has been met, but in this process we have actually discovered a whole variety of other problems involved. In addition to the requirement of government review and approval, there are also various requirements for administrative permits, certification of qualification and administrative fees for our businesses. So these will be the areas of focus for this government reform. Essentially, this reform will help the government focus on things that it should focus on, because some issues we used to be focused on in the past may tie down our businesses, cut government efficiency and even the government’s public credibility. So this is a self-targeted reform for the government, and we are fully determined to pushing it forward until our job is done no matter what obstacles or even resistance we may encounter.
Streamlining administration, the integration of control and decontrol and regulation and improvement of government services form an integral whole. The government needs to improve its oversight during and after the process and provide better services for the businesses and people. When market access is widened, the government needs to ensure a fair playing field for all market entities, and violations of laws and regulations will be seriously dealt with, such as making and selling fake foods and goods, cheating the market place and violations of intellectual property rights. All these areas are of high concern to our general public, involving food, drug safety and environment, etc. The government also needs to use the internet and other technologies to ensure that government administrative services will be more easily accessible to our people. The government also needs to focus more on areas like poverty alleviation, rebuilding of shanty towns, providing compulsory education and meeting people’s basic health care needs, all of which concern people’s livelihood.
So what the government should do is to send a message of “Yes” to all law-abiding market entities, to flash the green “go ahead” light to all hard-working entrepreneurs and innovators and to seriously deal with all violations of laws and regulation, showing them resolutely a yellow card, and even red card, to send them out of the market. Thank you.
Nikkei: U.S. Secretary of State Tillerson is visiting Japan starting from today and will visit China and South Korea later. It’s widely believed that one of his major goals is to discuss the situation on the Korean Peninsula. The DPRK has conducted several missile tests and continues to push forward its nuclear weapon programs, resulting in tensions in Northeast Asia. What will China do with the other parties concerned to solve the problem?
Premier Li Keqiang: China maintains a clear-cut stance on this issue. To achieve denuclearization of the peninsula and maintain peace and stability there, we need to sit down and talk. China supports all resolutions of the United Nations and firmly upholds the non-proliferation of nuclear weapons. Tensions may lead to conflicts and will harm all sides. We hope that through the efforts of all the parties concerned, the tensions can be eased, and negotiations can resume. Anyway, no one wants to see chaos on his doorstep. Thank you.