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China’s Premier Focuses on Stabilizing Growth

By Li Jiabao, Diao Ying and Qiu Quanlin
July 11, 2012
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Premier Wen Jiabao, faced with challenging GDP figures, met with economists and business leaders on Monday and Tuesday to discuss ways to boost growth.

Second-quarter GDP growth, expected to be released later this week, is predicted to be around 7.6 percent year-on-year.

Maintaining growth will be the "top priority", the premier said. "A stable growth rate is not only imperative today, but also a long-term commitment," he said.

Wen pointed out that as a large developing country, China needs to maintain a certain growth to provide adequate support for development and improve the standard of living.

An annual GDP target of 7.5 percent was set earlier this year, down from 9.2 percent in 2011 and 10.4 percent in 2010. But economists say once GDP growth is below 7.5 percent, a large number of jobs may be threatened.

At the moment, Wen said, some "reasonable increase in investment" is more important than, among other things, providing consumer incentives and diversifying exports.

GDP growth has traditionally been driven by government-led investment in fixed assets, consumer spending and exports. However, he stressed that new investment must be diverted to projects that contribute to improving the overall economy.

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