China to deepen reform, keep growth steady in 2018
China releases statement after annual economic planning meeting
BEIJING: China will deepen structural reforms and curb risks to the country's financial system while maintaining steady economic growth in 2018, the official Xinhua news agency said on Wednesday, citing leaders at an economic planning meeting.
China has seen better-than-expected economic growth this year even as it stepped up a campaign to cut debt, though there are growing concerns that the tighter policy environment could weigh on growth in the world's second-largest economy next year.
The annual economic conference is attended by China's top leaders and is keenly watched by investors for clues to policy priorities and economic targets in the year ahead.
The government will push forward with structural supply-side reform and maintain prudent, neutral monetary policy next year as it looks to improve the quality of growth, the news agency said citing a statement following the meeting.
"China's economic development has entered a new era. The basic feature is that our economy has shifted from the high-speed growth stage to a stage of high-quality development,"the statement said.
"Pushing forward high-quality growth is a requirement for maintaining healthy development of the economy."
The statement echoes President Xi Jinping's comment at a key party congress in October that China would strive for higher quality, more efficient and fair growth.
At a Politburo meeting earlier this month, top leaders pledged to deepen structural reforms and curb systemic risks from the country's growing debt pile while maintaining steady economic growth next year.
In the first nine months of this year, the economy grew 6.9 per cent from a year earlier.
Growth was underpinned by stronger exports and sustained state spending, positioning China to exceed the government's growth target of around 6.5 percent this year.
The basic feature is that our economy has shifted from the highspeed growth stage to a stage of high-quality development.A statement issued after an annual economic conference attended by China’s top leaders
China will maintain economic growth in a reasonable range next year and also keep credit growth reasonable, Xinhua said.
Sources have told Reuters that Chinese leaders are likely to stick with that growth target for 2018, even as they ratchet up efforts to prevent a destabilising build-up of debt.
Beijing has made progress this year controlling the level of debt in the economy as a portion of GDP, with corporate debt ratios declining slightly this year, according to data from the Bank of International Settlements.
While the statement following this year's economic conference made no mention of the need to lower corporate leverage - in contrast to last year's readout - that does not mean China is de-emphasising the deleveraging drive, said Mr Yang Zhao, Nomura's chief China economist.
"(Deleveraging) might not be intensified with new policies, but for policies already rolled out, they will materialise and be implemented next year," he said, adding that deleveraging is a component of China's supply-side reform strategy.
"The deleveraging, I think, will remain in place."
The leadership said the fight to control risks was primarily focused on dealing with financial risks, Xinhua said.
That aligns with a campaign this year to defuse points of risk in China's financial markets, including reining in the massive shadow banking sector and rolling out new rules for micro-lenders.
China will also take concrete measures to strengthen the regulation of local government debt, promote private investment, and will deepen reform of state-owned firms in 2018, Xinhua added.
In the property sector, which saw a rapid run-up in prices in recent years though gains have slowed, China will maintain the stability and continuity of property tightening measures, Xinhua said. - REUTERS