China's Premier Li Qiang Calls For 'Pragmatic And Forceful' Measures To Boost Economy

China’s Premier Li Qiang has called for “pragmatic and forceful” measures to restore confidence in the country’s economy.

What Happened: Li addressed the State Council, China’s cabinet, on Sunday, urging officials to "do more things that are conducive to boosting confidence and expectations, and ensure policymaking and execution are consistent and stable," reported Bloomberg citing the official Xinhua News Agency.

He emphasized the need for consistent and stable policymaking and execution, highlighting the importance of resolving practical problems faced by individuals and companies.

Li’s call for action comes amid a sluggish economic recovery, which has led to a recent downturn in the stock market. The Premier did not specify the exact steps to be taken but stressed the importance of winning the trust of the people through tangible achievements.

The Chinese government is actively seeking ways to revitalize the economy, which is grappling with challenges such as a property market slump, weak business confidence, and ongoing deflationary pressures.

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Efforts were made to curb the stock market decline before the Lunar New Year holiday, including increased state fund purchases, regulatory adjustments to reduce selling pressure, and a surprise replacement of the securities regulator chief. The holiday period saw a resurgence in travel, indicating a potential uptick in consumer spending.

The State Council meeting also discussed a draft government work report, which will contain key growth targets for 2024. This report is set to be announced at the annual legislative sessions in early March.

Why It Matters: Li’s recent call for “forceful” action to boost the economy comes after his efforts to attract foreign investors at the World Economic Forum in Davos. Despite the challenges facing China’s economy, Li has emphasized the country’s stability and potential for high returns on investment.

Earlier in February, Chinese equity markets experienced a strong rebound following pledges of government support after a market downturn. This recent call for action by Premier Li indicates the government’s continued commitment to stabilizing the economy and restoring investor confidence.

Despite the slowdown, experts have pointed out that investing in China still presents significant opportunities. Moreover, a recent report from the Centre for Economics and Business Research suggested that China could become the world’s top economy by GDP as soon as 2037.

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