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China's Growth Remains On Track, Premier Says

China's Growth Remains On Track, Premier Says
9/11/2012 8:31 AM ET

China's Premier Wen Jiabao on Tuesday said the economy is on track to meet its growth target of 7.5 percent this year.

Speaking at the World Economic Forum in Tianjin, Wen said the government stands ready to utilize the CNY 100 billion reserve fund to fine tune the economy if needed. The government gives high priority to stabilize growth, he added.

The Chinese leader expects the economy to stabilize on recent measures like tax reduction, required reserve ratio, and infrastructure spending.

Wen defended massive stimulus initiated by China during financial crisis in 2008. Some people accused that it paid undue price.

He said, "It was exactly due to our resolute decision and scientific response that China was able to avoid factory closures and job losses."

The government last week added stimulus worth more than CNY 1 trillion through the approval of a slew of infrastructure projects. It includes rail projects as well as highway construction.

At APEC Economic Leaders' Meeting in Russia held over the weekend, Chinese President Hu Jintao said that the economy is facing notable downward pressure largely due to slowing export growth.

China's economic growth slowed to a three-year low of 7.6 percent in the second quarter, just above the government's full-year target of 7.5 percent. This primarily reflected weak exports due to reduced demand from European Union, its largest trading partner.

Data released earlier on the day showed that bank lending surged in August mirroring higher government spending amid efforts to stimulate growth.

The central bank reduced interest rates in June and July and has also lowered the reserve requirement ration three times since November last year.

by RTT Staff Writer

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