China’s economic policies in coping with shocks of the novel coronavirus will focus on keeping jobs and protecting people’s livelihoods, Premier Li Keqiang said at a news conference on Thursday.
The focus of the country’s massive supportive policies is not large infrastructure construction projects, the Premier said, adding that about 70 percent of the funds from the supportive policies will be used to increase people’s income, which can spur consumption and increase market demand.
The country’s economic structure has been changed remarkably and consumption has become a major driving force of growth, Li said. Small and medium-sized enterprises provide more than 90 percent of the jobs, according to Li.
The newly increased fiscal deficit and funds raised from the special treasury bonds for COVID-19 control will be transferred to local governments. A special transfer payment mechanism will be established to ensure smaller businesses will truly benefit from these funds, he said.
“We will cut over 50 percent of unnecessary expenditures at the central government level,” said Li. “Governments at all levels must tighten their belts.”
China will also expand effective investment, Li said. An increase of 1.6 trillion yuan ($223.6 billion) of local government special purpose bonds, together with the issuance of special treasury bonds for COVID-19 control this year, will support investment in new infrastructure facilities, new types of urbanization, and key projects that contribute to better lives for people.