China on Sunday highlighted economic and social stability in 2017 as vital to maintaining growth, ensuring employment, and counteracting risks from both home and abroad.
"Stability is of overriding importance... we must not allow the red line to be crossed concerning financial security, people's wellbeing, or environmental protection," said Premier Li Keqiang as he delivered a government work report to the opening meeting of the annual session of the top legislature.[Special coverage]
Under the prerequisite of stability, China should forge ahead with reforms to seek progress in key areas, Li pledged, cautioning risks related to non-performing assets, bond defaults, shadow banking, and Internet finance.
The rising tide of protectionism and de-globalization threatening the world economic framework, means the theme of "seeking progress while maintaining stability" must remain the guiding light for China's economic work.
The premier noted that uncertainties about the direction of some major economies' policies and their spillover effects are gathering, which put China at a crucial and challenging stage.
The 2017 growth target of around 6.5 percent -- "or higher if possible" -- sets China's economy in a proper range with enough room for reform.
Last year's target of 6.5-7 percent saw the economy expand by 6.7 percent, the job market remain steady, and reforms progress at an appropriate pace.
"Without stability, China could never achieve such a target," said Jia Kang, a national political advisor and chief economist with the China Academy of New Supply-side Economics.
The significance of stability cannot be overemphasized in 2017.
Apart from the challenges from both home and abroad, this year will see the opening of the 19th Communist Party of China (CPC) National Congress, when a new CPC central committee will be elected, making stability of crucial importance.
With due attention to stability, Li's report made no bones about the need to tackle "really tough" issues this year, promising that there would be no shying away from the five tasks of supply-side structural reform: cutting industrial capacity, reducing housing inventories, deleveraging, cutting corporate costs and strengthening weak economic links.
Coal production capacity will be slashed by at least 150 million tonnes and steel by around 50 million tonnes this year. "Zombie enterprises" -- economically unviable businesses usually in industries with severe overcapacity and kept alive only with aid from the government and banks -- will be dealt with through more use of market- and law-based methods.
The screws will also be turned on corporate leverage, especially in state-owned enterprises.
While tackling structural imbalance at home, China is committed to a wider opening-up and greater engagement with near neighbors and distant partners: a responsible player in strengthening global growth and governance, during difficult times.
Sunday's report not only re-emphasized the role of the Belt and Road Initiative, but promised more efforts to facilitate trade and investment, both inbound and outbound.
Foreign companies will be welcomed into national science and technology projects. They will be able to go public in China and to issue bonds.
"China's door will keep opening wider, and China will keep working to be the most attractive destination for foreign investment," said the report.
Political advisor Zhang Yunling said China will defend openness and the development of a truly global economy. China's pursuit of "stability with progress" will breed a new mechanism for international cooperation and the shared development of all countries.
