BEIJING — An annual conference that helps set economic policy in China ended with a lengthy government statement Sunday warning of difficulties in the global economy as well as industrial overcapacity and financial-sector risks at home.
But a review of the two-day conference’s activities, which was released by the official Xinhua news agency, suggested few changes in existing economic policies, calling for continuity for the time being.
The statement endorsed tax cuts, continued curbs on real estate speculation and a broader effort to increase domestic consumption and wean the economy from its dependence on exports and investment.
“The opportunities facing us are no longer the traditional ones of simply entering the international division of labor, expanding exports and accelerating investments, but rather new opportunities forcing us to expand domestic demand, improve innovative capacities and promoting the transformation of the mode of development,” the statement said.
Held in December each year, the Central Economic Work Conference in theory is jointly run by the Central Committee of the Communist Party and by the government’s cabinet of ministers. In reality, the Standing Committee of the Politburo has the power, and all seven of its members attended the conference, together with Prime Minister Wen Jiabao, who left the standing committee last month but remains in office as prime minister until the National People’s Congress next March.
While China has many economic opportunities, “we must soberly recognize that there are still many risks and challenges confronting our national development,” the overview released by Xinhua said. “Problems with imbalances, ill-coordination and lack of sustainability remain pronounced.”
“The contradiction between downward pressures on the economy and relative overcapacity in production is deepening,” the statement continued. “Business operating costs are rising while innovative capacities are inadequate. There are latent risks in the financial sphere.”
Previous annual conferences have lasted three days. The government issued no explanation of why the conference this year appeared to last only two days, opening Saturday and closing Sunday.
The conference called for the agricultural sector to pay attention to maintaining an adequate food supply for the population, and endorsed continued urbanization, a favorite theme of the incoming prime minister next March, Li Keqiang.
“Urbanization is a historic task of our country’s modernization, and also possesses the greatest potential for expanding domestic consumption,” the statement said.
The statement called for continued but unspecified industrial reforms to address the problem of overcapacity. It was not clear what would be done to address risks in the financial sector, but a government official had said before the conference that China’s leaders were eager to move toward the introduction of a system of bank deposit insurance.
The precise details of discussions at Central Economic Work Conferences sometimes take days or weeks to dribble out.
Article source: http://www.nytimes.com/2012/12/17/business/global/china-plans-on-continuity-in-economic-policy-in-2013.html?partner=rss&emc=rss