Chinese Premier Li Keqiang addresses the opening ceremony of the annual meeting of the New Champions, also known as the Summer Davos Forum, in Dalian, northeast China's Liaoning Province, Sept. 10, 2015. (Photo: Xinhua/Yao Dawei)
Premier Li Keqiang said on Thursday that China's economy remains a source of the world's growth thanks to people's zest for innovation, entrepreneurship and stronger international cooperation.[Special coverage]
China's confidence is well-grounded and not "blind optimism," the premier said in a speech at the World Economic Forum's event in northeast China's Dalian, known as Summer Davos.
The stable and sustainable development of China, a hard-achieved feat, benefits the people and means business opportunities for the world, Li said.
A BIG CONTRIBUTOR
China contributed roughly 30 percent to world economic growth during the first half of this year, Li said. "China is the source of global growth, rather than risks."
Despite enormous headwinds, the government is determined to pull off a managed slowdown in its quest for more sustainable growth led by consumer spending and innovation rather than investment and credit expansion.
Though China's headline growth rates of 7.3 percent last year and 7 percent in the first half of this year are a far cry from the double-digit growth seen in previous decades, China has still managed to keep the world economy afloat.
Li said that a 7-percent rise is not an easy achievement in a slowing world economy. The rate is among the highest in major economies.
Li also noted the central government's fiscal deficit, set at 1.12 trillion yuan, is low compared with other major world economies and there is great potential in the country's financial markets.
"China still has a lot of tools to use in its innovative macro-economic adjustment policies and will continue to roll out targeted measures to counter downward pressure," Li said.
A more encouraging sign, according to Li, is that China's economy is more oriented toward consumption, which accounts for half of China's economic output and 60 percent of growth.
As the Chinese become affluent, their "itchy feet" have taken them all over the world. Last year, more than 100 million people traveled abroad and the number of visitors rose 10 percent in the first six months of this year. And wherever the Chinese go, they shop.
Airbnb, the fast-growing housing rental service, aims to make deeper inroads into China, a market the company that has the highest expectation for future growth, Nathan Blecharczyk, co-founder and CTO of Airbnb, told Xinhua during the forum.
Last year, the number of Chinese travelers using airbnb grew 700 percent, faster than any other country.
Chinese smartphone users, nearly 500 million of them, are using their phones to do everything from shopping to hailing taxis and ordering takeouts in a trend launched by internet giants Alibaba, Tencent and Baidu to deliver better services through mobile internet.
"What we are watching right now is a transition of the economy to more consumption, more services and less dependency on investment," Rich Lesser, CEO of management consultants Boston Consulting Group, said during a Summer Davos session.
WAVE OF ENTREPRENEURSHIP
Creativity is the biggest resource for development in China, where "a nationwide wave of innovation and entrepreneurship" has emerged involving skilled personnel and migrant workers, the premier said.
The Chinese government has introduced measures including tax reductions and streamlined government administration to spur business startups. Last week, it set up a development fund worth 60 billion yuan (9.4 billion U.S. dollars) for small and medium-sized enterprises.
China has a work force of 900 million people, with seven million new graduates hitting the job market each year. More graduates are choosing to start their own businesses and they are an important force that China can rely on for stable growth, Li said.
Li related a visit he made to an outstanding small tech enterprise in Dalian on Wednesday. The micro-controller company only has 10 full-time employees but has managed to attract 280,000 registered online users in two years and develop more than 100 products.
The company is working to upgrade 30,000 outdated machines in factories lying idle in the former heavy industry base of northeast China, so as to put these facilities back into productive use.
There are tens of thousands of similar companies in China that can achieve their dreams by pooling their wisdom and resources, Li said. "They deserve the title of 'new champions.'"
He noted that more than 10,000 new companies are registered every day and they in turn become job-providers; this explains China's robust job creation despite economic headwinds.
In a question and answer session, Li said that Chinese enthusiasm for innovation and entrepreneurship has drawn the world's attention. "This will bring in capital, as well as advanced ideas and technologies," he said.
The premier pledged reforms to allow for more partnerships between the government and private investors from China and abroad. "It is no longer just the government's show," Li said.
Meanwhile, Li vowed that China will continue to try hard to protect intellectual property rights, as better IPR protection is crucial to attracting international investment and encouraging local companies' creativity.
STRONGER INTERNATIONAL COOPERATION
Li called for stronger international cooperation in production capacity in order to solve structural problems in global growth.
Countries at different development stages can connect their demand and supply and inject new vitality to the world's economy in the cooperation, said Li.
As a manufacturing powerhouse, China can supply developing countries with high-quality equipment at low price with advanced technology purchased from developed countries and provide developing nations, serving as a bridge in international cooperation in production capacity.
Li cited China's "Belt and Road" initiative as an example of the country's expanding international cooperation in production capacity.
China has clarified 12 major industries for international industrial cooperation, including steel, shipbuilding, railways and electric power, and established funds to support such cooperation.
