Li: Chinese Economic Growth In 'Proper Range'  

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  • TEMPO.CO, Beijing - China's No. 2 leader tried Wednesday to mollify foreign concerns about its economic slowdown, saying growth is in the "proper range" and Beijing has no plans to allow its currency to decline further.

    Speaking at a meeting of the World Economic Forum in the eastern city of Dalian, Premier Li Keqiang said Beijing will stick to plans for market-opening reforms despite recent "fluctuations" in economic performance.

    Communist leaders are in the midst of an unusually high-level effort to calm global financial markets after a collapse in Chinese stock prices and abrupt downturns in manufacturing and exports.

    The central bank governor, finance minister and securities regulatory agency issued similar statements last weekend that stock market turmoil was ending and the economy was stable.

    "The underlying trend of the economy is still moving in a positive direction," said Li, the country's No. 2 leader and its top economic official. Pointing to data showing more than 7 million urban jobs were created in the first half of the year, he said, "all this shows the Chinese economy has been running within the proper range."

    Li announced no new initiatives but touched on a wide range of issues that are sensitive for foreign investors in a clear attempt to assure them business conditions would remain stable.

    China's economy has cooled steadily over the past two years as communist leaders try to steer it to more self-sustaining growth based on domestic consumption instead of exports and investment. But foreign concern about a possible "hard landing," with slumping growth fueling political tensions, spiked up after trade and factory activity fell in July and August.

    Li said current growth, forecast by the government at about 7 percent for the full year, is acceptable so long as it generates enough jobs.

    The premier said Beijing has no further plans to allow its yuan to decline in value following a surprise Aug. 11 devaluation.

    Chinese authorities said the change was aimed at making the yuan's state-set exchange rate more market-oriented, but it prompted concern Beijing might depress it further to give a price advantage to exporters that are struggling with weak global demand. That sparked fears of a global "currency war" if other governments responded by pushing down their own exchange rates.

    Reform advocates complain Beijing is moving too slowly in carrying out a long-range development blueprint issued in 2013 that calls for giving market forces a central economic role for the first time.

    In a report this week, the European Union Chamber of Commerce in China said regulators are backtracking in some areas, including with the introduction of proposed security legislation that would limit access to foreign computer security products.