CHINA has rolled out “more forceful” economic policies this year than it did in 2020, Premier Li Keqiang said, as he warned the country faces an arduous task in ensuring its economic recovery.

Li was speaking during a Monday meeting of the State Council, China’s Cabinet, where he added that the size of stimulus in 2022 has been “reasonable” and “appropriate,” according to reports from broadcaster CCTV and Xinhua.

“This year, in response to new challenges, we decisively launched a package of policies and follow-up policies to stabilize the economy, with the strength exceeding 2020,” Li was quoted as saying.

China’s economy was affected by unexpected factors in the second quarter and the government will seek to cut red tape, stabilize employment and prices, and keep economic operations within a reasonable range, Li said,

He also said policies that have been announced so far need to be implemented, so as to keep the economy running within a reasonable range.

The government last week announced a 19-point stimulus plan, which included more than 1 trillion yuan (US$145 billion) worth of funding largely intended for infrastructure spending, in its latest bid to bolster growth.

The economy faces several challenges as it continues to grapple with a property sector slump, as well as COVID outbreaks and restrictions. Shenzhen locked down some parts of its districts this week, as did areas around Beijing. Power cuts due to a brutal heat wave have also complicated the recovery.

China’s economy narrowly escaped a contraction in the June quarter. Economic activity rebounded that month but slowed in July, raising pressure on policymakers to step up support.

The Ministry of Finance said yesterday that China will step up measures to boost demand and stabilize employment and prices in the second half of the year to optimize economic outcomes.

The pledge came after the package of new economic stimulus measures announced by the government last week, including an announcement that local governments would be urged to use up more than 500 billion yuan in existing special bond ceiling limits by the end of October.

“China will make good use of local government special bonds, and support the implementation of policy bank financing tools” in the second half of the year, said the ministry in a statement published on its website.

The ministry also said that it will strictly curb new local government hidden debt, which refers to off-balance sheet debt financing by local governments.

China’s fiscal revenue rose in June due to easing COVID-19 restrictions with 25 provinces seeing growth in revenue, after a decline in April and May due to value-added tax credit rebates, the ministry said.

“China will strengthen macro economic policy adjustment and plan incremental policy tools to keep economic operation within a reasonable range,” the ministry added. (SD-Agencies)