The country's economy has expanded at the slowest pace in the past 26 years. One of Premier Li's proposed solutions to this situation is "to tackle 'zombie enterprises'", which have been overproducing on coal and steel, exceeding the real market demand for such commodities. In describing their current situation, Mr. Li refers to the Chinese economy as being "a butterfly struggling to emerge from a chrysalis".
Amongst the challenges being faced, he mentions tge overwhelming pollution levels and the "laziness" of a few government officials, which prove to make any proposed solution more difficult to reaching a resolution. In addition, Premier Li has brought out some forecasts predicting a rough year ahead for the country due to the threats of growing protectionist policies, in reference to President Trump's proposed actions on international trade.
The National People's Congress leaders are looking for ways to deal with some "painful reforms" in order to solve a build-up in the country's debt. But, in the overall grand scheme of things, one of the main concerns goes back to pollution levels, stemming from the heavy manufacturing processes taking place, becoming one of the priorities at the moment. In regards to that issue, Premier Li's statement was as follows: "We will make our skies blue again [...] all sources of industrial pollution will be placed under round-the-clock online monitoring".
Source:
http://www.bbc.com/news/world-asia-china-39137294
3 comments:
It makes sense that Premier Li Keqiang is trying to be creative to boost productivity, including eliminating or reducing production from companies that overproduce to make the economy more efficient. However, it makes sense that the economy is slowing down because it has had such a boom over the last few decades. Just because they are expanding the economy at a diminishing rate relative to previous years, isn't a sign to panic. In fact, I think the government can do more to hurt the economy if they struggle too much against small recessions or times where business isn't growing exponentially.
I agree with Sam, though I do think that the panic of a diminishing rate can be attributed in part to the apprehension of some of the more protectionist leanings of the United States as of late. I am particularly interested to see how Premier Li Kequiang plans to address pollution. I know that in times of desperation for economic growth, the environment tends to be placed on the back burner, so to speak. I am apprehensive of the idea that an online monitoring system will fix the problem. Does China have a pollution monitoring problem in the first place? Would it not be more beneficial (albeit more costly) to address the issues at a more structural level? China is so strong in the manufacturing industry, what can really be done to make a meaningful dent in pollution that won't negatively affect production? I have a lot of questions.
I'm actually not very surprised about the cut on growth target. In my memory, one reason for China to try to keep the growth rate high is to solve the labor surplus problem. These years, however, there seems tendency of labor shortage. That's also why China ends the One Child Policy and gradually encourages people to have more than one child. Also, these years Chinese government begin to strength the quality of GDP instead of just the quantity. It's good to see government decides to slow down and hand on solving the pollution problem.
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