China will protect the rights of entrepreneurs and continue to support private businesses, Premier Li Qiang said in his first public comments since taking office, while also downplaying the importance of the economic growth rate.
Li said citizens are more focused on issues that affect their daily lives, rather than the pace of gross domestic product.
“Honestly speaking, most people do not keep their eyes on GDP growth all the time,” he told reporters in Beijing on Monday. “What they care more about are the things that happen in their everyday life, like housing, employment, income, education, medical services and environment.
The government will prioritize stability, which means stabilizing growth, prices and jobs, Li said. Achieving this year’s growth target of around 5% is “not an easy task” because of multiple risks, he added.
Li, a longtime associate of President Xi Jinping and the former Communist Party boss of Shanghai, was officially appointed premier on Saturday at the National People’s Congress, the annual parliamentary gathering.
Li reiterated the government’s economic strategy at the media briefing on Monday. Earlier, Xi had said China must redouble efforts to ensure stability and bolstering self-reliance in a speech to mark the start of his third term as head of state.
The premier’s comments about private businesses may help to allay concerns after regulatory crackdowns in the technology sector and against for-profit education companies spooked investors.
Beijing set a modest GDP growth target for this year after missing 2022’s goal by a wide margin, hoping consumer spending will drive the recovery after the government’s zero-tolerance approach to Covid was abandoned late last year. Economists expect growth to reach 5.3% this year.
While consumer spending has shown signs of a stronger rebound, the outlook remains uncertain. The effect of infrastructure investment — a traditional tool Beijing uses to boost the economy — has declined while local government debt burdens have ballooned. Exports are also falling and the housing market is yet to recover from a historical slump.
Li also made the following comments to the media on Monday:
China has a super-sized market with huge demand, Li said. There are many new sectors that can be tapped, providing great promise for private businesses, he said.
He called for officials at all levels to sincerely care and support the growth of the private sector. They should take the lead to respect entrepreneurs and create a good environment for business creation, he said.
Li said the solution to the employment problem lies in economic growth. The government will continue to pursue an employment-first policy, and will increase support of employment services, and technical training.
The number of college graduates will hit more than 11 million this year, which will add to pressure on job creation, he said.
While some worry that China’s demographic dividend is disappearing as the population shrinks, Li said it’s not that simple an issue. The rich supply of human resources remains a strength, he said, citing more than 240 million people that have received higher education.
He said the focus shouldn’t be on the size of the population, but it’s quality.
China will carefully study and fully debate the retirement age issue and introduce policies at a proper time, Li said.