China to continue implementing the policy package and follow-up policies to boost economic recovery and growth

China will continue to effectively implement the policy package for stabilizing the economy and the follow-up policies, to further promote economic recovery and growth, according to the decision made at the State Council's Executive Meeting chaired by Premier Li Keqiang on Wednesday.

The meeting urged efforts to fully study and implement the guidelines laid out at the 20th National Congress of the Communist Party of China. After arrangements are made, the key lies in delivering them on the ground. All departments should perform their duties diligently and ensure effective policy implementation, to strive for sound economic and social development.

Since April this year, to cope with shocks from greater-than-expected factors, a policy package for stabilizing the economy and follow-up policies have been introduced in a timely and decisive manner, with front-loaded implementation of the policies outlined at the Central Economic Work Conference and in the government work report.

These policy measures are both forceful and appropriate, which are conducive to stabilizing the current economic performance and promoting sustained development. The economic slide in early second quarter was reversed in time. The economy is stabilizing and picking up, which is no easy feat. This also creates a critical window of opportunity for boosting the upward momentum.

Efforts will be made to ensure policy implementation and further unlock policy effects, keep employment and prices stable, secure better economic performance in the fourth quarter over the third and keep major economic indicators within a proper range.

The meeting urged greater efforts to implement on the ground the policy package for stabilizing the economy and its follow-up policies. Policies such as tax refunds, tax deferrals, fee cuts and pro-job subsidies will be thoroughly executed. Efforts will be made to ensure stable energy supply. Further efforts will be made to keep transportation and logistics services open and smooth.

Greater support will be introduced to promote sustained and sound development of the platform economy. The taskforces that supervise and assist the efforts for stabilizing overall economic performance should continue to supervise and coordinate the settlement of problems.

Market vitality and social creativity will be better unlocked. China has a hardworking and intelligent people, and over 160 million market entities: this is what makes China's economy resilient.

It is imperative to keep advancing reform and opening-up, deepen the reform of government functions, and foster a better business environment. Supervision and inspection will be enforced to ensure full policy delivery to anchor market expectations and boost confidence of market entities.

All localities and all departments must fulfill their duties in meeting people's basic needs, and deliver on the policies of expanded subsistence allowance coverage and provision of unemployment subsidy and relief allowance.

The mechanism of raising social benefits pro rata with price increase will be earnestly implemented. Local governments with real difficulties will be subsidized by the central government as appropriate, to make sure people's basic living needs are well met.

"Overall, the policy package for stabilizing the economy and the follow-up policies are forceful and are warmly welcomed by localities. Mature projects should be taken forward without delay, and the approval procedures for projects that can get started within the year should be simplified wherever possible," Li said.

The meeting noted the need to expedite the delivery of the policies for spurring investment and consumption, to address the problem of insufficient effective demand. Fiscal and financial policy instruments that support key projects and equipment upgrading and renovation should generate more physical gains in the fourth quarter.

It is imperative to ensure efficient operation of the relevant coordination mechanism, to kick-start more projects and accelerate construction while ensuring project quality. Funds for projects that fail to start as scheduled will be reallocated to new ones.

Private investment will be supported to participate in key projects. The issuance of loans for equipment upgrading and renovation will be expedited, and purchase of homegrown and foreign-made equipment will be supported on an equal basis, to expand manufacturing demand and guide expectations.

Efforts will be made to promote the recovery of consumption as the main driving force for the economy. Construction of key projects and equipment upgrading and renovation should be better aligned with the goal of spurring consumption.

Public works programs will be expanded to create jobs, raise income and boost consumption. Equipment upgrading and renovation by micro, small and medium-sized businesses and related to consumption will be supported by the special re-lending facility and government-funded interest subsidies.

Policies will be implemented to support consumption of big-ticket items such as automobiles and consumer services. City-specific policies will be adopted to meet people's basic housing needs and the need for improved housing conditions.

"The policy-backed and development-oriented financial instruments and the special re-lending facility for equipment upgrading and renovation function as two important levers. We must continue to bring them into effect, with a special focus on boosting consumption," Li said.

The meeting noted that the average time needed for refunding newly added value-added tax (VAT) credits in the manufacturing industries has been cut to two working days.

On top of continuing the practice of prompt refunding upon application, intensified efforts will be made to improve tax refund services for micro and small businesses and self-employed households, to see that all eligible VAT credits are refunded whenever and wherever possible, and that businesses will benefit as early as possible, in a bid to support market entities, ensure job creation and meet people's essential needs. Tax fraud, tax evasion and disruptions to the tax refund policy will be dealt with in accordance with law.

"The large-scale VAT credit refund has played a vital role in helping firms overcome difficulties and steadying the economy, and has cleared most of the refund backlog accumulated over the years. This policy treats state-owned, private and foreign market entities as equals, and has been a widely welcomed boon to the cash flow of businesses," Li said.