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Premier Li Keqiang: Twin growth engines will drive economy

Chen Mengwei
Updated: Nov 5,2014 6:02 PM     english.gov.cn

[Photo/Xinhua]

Premier Li Keqiang highlighted the twin roles of emerging and traditional industries as the two engines driving continued economic growth.

“Our infrastructure and public works still lag,’’ he said as he stressed that major projects in the offing were set to unleash major benefits. “Building the Midwest railway, speeding up reconstruction, and improving the urban underground pipeline network are projects of great potential,” he said while bringing attention to a growing entrepreneurial spirit.

“However, through reform of commercial systems and other measures to streamline administrative procedures and a delegation of powers to lower levels, a momentum of entrepreneurship and innovation has been gathering pace in society. Emerging business models and industries, like e-commerce and small and micro-enterprises, will become the new engine of China’s economic growth.”

Premier Li made the remarks while he chaired a meeting with scholars and heads of enterprises to discuss the economic situation and future projects on Nov 3 in Beijing.

Among those invited were Liu Qiangdong, founder of e-commerce company JD.com Inc, and Luo Feng, chairman of Internet direct-selling platform IZP Technologies Co Ltd.

“Some may complain about the market and demand, but the e-commerce industry hasn’t felt many pinches,” JD.com’s Liu told the Premier, raising a laugh from those in attendance.

Liu largely credited the high growth rate of his company in recent years to an expanding rural market.

“We always thought consumption in villages would be low. But in recent years we’ve expanded our express services to rural areas. In the first half of the year sales growth in the countryside increased by more than 300 percent, which is two to three times higher than that for urban areas,” Liu added.

The Premier responded that “you’ve made it possible for villagers to enjoy the same consumer services as people in the cities. It not only expands the market, but also advances social fairness’’.

Luo said his online platform IZP may see a 50 percent increase in this year’s turnover as it allows domestic factories to do business directly with foreign clients.

Representatives of the traditional industries were also in attendance. Zhan Chunxin, chairman of the Zoomlion Heavy Industry Science & Technology Development Co. Ltd., told the Premier about the development, and challenges, facing the equipment manufacturing industry.

After Zhan’s comments, Li noted that the timing seemed right for global expansion. “I learned from visits overseas that manufacturing equipment has huge market share in some developing countries. Your machines are highly cost-effective, and you have a strong construction team. This should be perfect timing for you to expand business overseas.’’

Li Jianhong, chairman of China Merchants Bank, citing a survey of 2,000 corporate account managers and more than 2,000 personal account managers, said that indicators showed a rise in investor confidence despite the short-term difficulties facing some enterprises.

The Premier sought clarification. “Are individual industrial, commercial businesses as well as small and micro enterprises included?” Li asked him.

“Yes, their willingness to invest has shown a significant increase,” the bank chairman replied.

The Premier focused on the importance of emerging and small enterprises.

“Why can we achieve rising employment amid the slowing of GDP growth this year? This is directly related to the surge in the number of emerging small and micro-enterprises,” he said.

To achieve stable and sustainable growth, the economy must focus on improving quality and efficiency, boosting development through reforms and upgrading, Premier Li said.

Greater efforts should be made to support new technology, businesses and industries so that they can serve as engines for the economy, Li said, adding that traditional sectors should also be directed toward high-end, low-carbon and smart development.

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