Premier Li Keqiang's press conference was recorded

The following is the transcript of Premier Li Keqiang's press conference:

Zhang Yesui:

Ladies and gentlemen, friends from the media, good morning. The Fifth Session of the 13th National People's Congress (NPC) has just held its closing session, and it is a great honor for us to invite Premier Li Keqiang to meet with you and answer your questions. I would like to invite Premier Lee.

Li Keqiang:

I would like to thank the journalists for their efforts and hard work during the two sessions in China. Due to the pandemic, we continued to hold press conferences via video link. I would like to answer the questions raised by my journalists.

Zhang Yesui:

Thank you, Premier Li Keqiang, and I will now open the floor for questions.

My question is about the multiple challenges facing China's economy. China's economy is now gradually transitioning from high-speed growth to sustainable, equitable and green growth, and we have seen a series of measures taken by the Chinese government last year to reduce debt levels and regulate high-tech companies. This year, the Chinese government has set what many economists consider ambitious growth target of 5.5 percent, which is set in the face of the continued spread of the coronavirus pandemic and the conflict in Ukraine. I would like to ask, does the Chinese government mean that it will put more emphasis on growth this year? that it will prioritize growth over structural reforms and the reduction of carbon emissions? how will the Chinese government balance these different development goals? And with regard to Ukraine, where does China's important economic and trade relationship with Europe fit in China's response to this crisis? Is China worried that this relationship with Russia will affect its good relations with Europe, and even China's own economic development, because of its current handling of the crisis?

You mentioned China's economic growth rate, and last year, China's total economic output reached more than 110 trillion yuan, and it can be said that it is growing on a high base to continue to grow. From a global perspective, it is a big problem for such a large economy to maintain medium-high growth rate. You mentioned earlier that our economic growth target of around 5.5 per cent this year is an ambitious target. I still remember that at this news conference last year, a reporter asked me, saying that you have set a target of 6 percent or more, and is the target of 6 percent too low? We are not unfazed because of the low base of the previous year, and it is entirely possible to achieve a growth rate of 8 percent or even higher last year, but we are still sure that the growth rate will be more than 6 percent. However, the benchmark of our macroeconomic policy is determined according to 6%, which means that fiscal, monetary, employment and other policies must be carried out around this benchmark, which has enabled us to reduce the deficit ratio and the macro leverage ratio to stabilize and decline, which also reserves policy space for responding to new challenges this year.

Last year and even to February this year, under the condition of high inflation in many countries around the world, our consumer prices, that is, CPI, rose by less than 1%, which cannot but be said to be related to the reasonable macro policies we implemented.

Of course, as I said just now, we are proceeding from China's actual conditions in formulating macroeconomic policies, and we do not mean to evaluate other countries.

Last year, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at the core, and through the joint efforts of the people of the whole country, we not only completed the main goals and tasks of economic and social development for the whole year, but also laid a solid foundation for this year. This year, the economy has indeed encountered new downward pressure and challenges, not to mention the changes in various complex environments and the increase in uncertainties, that is, we must achieve the goal of 5.5%, and its increment, that is, the increase of 5.5% of China's GDP of more than 100 billion yuan, is equivalent to the total economic output of a medium-sized country. Ten years ago, our total economic output was still more than 50 trillion yuan, an increase of 10 percent, and an increase of six or seven trillion yuan was enough, but this year we must have an increase of nine trillion yuan in nominal GDP. It's like mountaineering, if you want to climb a 1000-meter mountain and you want to climb 10%, then 100 meters is fine, if you want to climb a 3000-meter mountain and you want to go up 5%, that's 150 meters. And the conditions have also changed, the higher you go, the lower the air pressure, the less oxygen, and it seems that the speed has slowed down, but in fact the weight is heavier.

To achieve a growth rate of about 5.5 percent, which is stable at a high level, in essence, is progress, it is not easy, and there must be corresponding macroeconomic policy support. For example, in fiscal policy, we have lowered the deficit rate to 2.8 percent this year, and the deficit is more than 200 billion yuan less than last year. But at the same time, we have stepped up fiscal spending. As I said in the government work report, in the past two years, we have been able to use the profits of the unused and surplus specific central financial institutions and franchised institutions, plus the fiscal budget stabilization and adjustment fund, and the scale of new expenditure will not be less than 2 trillion yuan, and the increased scale will mainly be used to reduce taxes and fees, especially tax refunds, which is equivalent to giving oxygen to those who climb high mountains. Of course, we also have a number of supporting financial, employment and other measures.

If the measures we have taken this year are not only short-term, but also based on the present and long-term, and never advance for the future, it is sustainable. This is because, as a journalist friend mentioned, China still has many problems such as climate change, income inequality, and debt, which need to be dealt with vigorously in the medium and long term, including this year. China's modernization is still a long-term process, and we need to use development methods to solve problems in this process.

You just mentioned the situation in Ukraine. The current situation in Ukraine has attracted the attention of the world, and China is deeply concerned and deplores. We sincerely hope that the situation in Ukraine will be eased and peace will return at an early date. China has always pursued an independent foreign policy of peace, and has never targeted any third party in the development of bilateral relations. In the spirit of mutual respect and mutual benefit, we will develop cooperative relations with all parties and provide more stability to the world. Thank you.

Since Russia's attack on Ukraine has caused 2 million refugees and hundreds of civilians to have died, and people are worried about the prospect of escalating their nuclear posture, China has not condemned Russia's actions or called them invasions. Will China provide further economic and financial support to Russia when Russia faces sanctions? Are you worried that doing so will be negatively affected by sanctions from other countries?

As I said earlier, China has always pursued an independent foreign policy of peace. On the situation in Ukraine, China maintains that the sovereignty and territorial integrity of all countries should be respected, the purposes and principles of the UN Charter should be observed, and the legitimate security concerns of all countries should be taken seriously. China has made its own judgment on this basis and is ready to play an active role in working with the international community to return to peace.

The current situation in Ukraine is indeed worrying, and we should do our utmost to support Russia and Ukraine in overcoming difficulties to negotiate and negotiate a peaceful outcome, and we support and encourage all efforts conducive to a peaceful settlement of the crisis. The international community and all parties have a consensus on the urgent task of preventing tensions from escalating or even spiraling out of control.

China calls for maximum restraint to prevent the emergence of a large-scale humanitarian crisis. China has put forward an initiative to deal with the situation in Ukraine, especially the humanitarian situation, and will continue to provide humanitarian assistance to Ukraine.

At present, the world economy is already very difficult to be affected by the impact of the epidemic, and the relevant sanctions will have an impact on the recovery of the world economy, which is not beneficial to all parties. China is ready to make its own constructive efforts to maintain world peace and stability and promote development and prosperity. Thank you.

Research by the National Finance and Development Laboratory shows that fee reductions are the most helpful for small businesses, followed by tax cuts. Can you share with us specific data on the impact of tax and fee cuts? Also, due to the slowdown in the real estate market, local government finances have decreased, what are the considerations in this regard? and when it comes to consumption, will the government consider issuing consumption vouchers and other similar policy measures?

Conclusions should be supported by theory and practice. Judging from our practice in the past few years, the effect of tax reduction and fee reduction is the most direct. I remember going to the eastern region last year and talking with more than a dozen entrepreneurs, and they talked about the difficulties in the operation of enterprises, and hoped that the state would introduce some more macro support policies. I said at the time that the central government's policy reserves are there, but they need to be used centrally. There are three choices, but only multiple-choice questions can be made, which is one of the three. One is large-scale investment, maybe you can get orders. The second is the issuance of consumption vouchers, which may directly stimulate consumption. The third is to reduce taxes and fees for enterprises, stabilize employment, and promote investment and consumption. They were silent for a moment, and then replied almost in unison, and we chose the third one. Because it's the most direct, fair, and efficient way. Judging from the relevant reports I have received this year, tax and fee reductions are generally regarded as the first expectation of the government's macroeconomic policies. It seems that fertilization must be applied to the roots, and the roots can flourish in order to flourish.

I have also seen in the materials that some people are worried that after the implementation of tax and fee reductions for several years, the marginal effect has been decreasing, that is, the effect is not as great as before. This time, we have implemented large-scale tax cuts and fee reductions, which are both tax refunds and tax cuts, with a scale of 2.5 trillion yuan. In 2020, when the economy was hit the hardest, we had such a large scale of policy, and we finally survived, and we adjusted the structure this time to put tax rebates in front. The so-called tax refund, that is, in accordance with the design of the tax system, for the market entities similar to the tax amount paid first and then refunded, we adopt the method of early tax refund, that is, the tax amount retained in a lump sum to the enterprise, with a scale of more than 1.5 trillion yuan. If it works, we'll step it up.

We give priority to small and micro enterprises in tax refunds, because small and micro enterprises are large and wide, support a large number of employed people, and now is the most tight and difficult time for their funds, so we must before the end of June this year, the tax credit of small and micro enterprises will be refunded in place at one time, and the tax credit of some key industries such as manufacturing and R&D services will be fully solved within the year, and the incremental tax refund for small and micro enterprises will be solved month by month. When I participated in the discussion at the CPPCC, one of the CPPCC members is an entrepreneur, and he told me that compared with other measures such as tax and fee reductions and investment, tax refunds come the fastest and the best. There may be many twists and turns in running a project, and tax rebates are equivalent to directly discovering money and increasing cash flow for enterprises, which is timely rain. It seems that it is better to say a thousand words than to do a practical thing, and we must put this key measure in place.

Tax rebates and fee reductions are doing subtraction, but in essence they are additions, because if you refund today, you will increase tomorrow, and if you reduce today, you may add tomorrow. Last year, the amount paid by our new tax-paying entities exceeded the amount we paid for tax reductions that year, and this is a matter of accounts. Since 2013, we have implemented the value-added tax reform, guided by tax reduction, and have reduced a total of 8.7 trillion yuan, when our fiscal revenue was about 11 trillion yuan, and last year it has exceeded 20 trillion yuan, an increase of nearly double. Because the enterprise has benefited in this process, the so-called benefit is that its benefits have increased. The so-called deep water returns to the fish, and the water has more fish, which is to conserve the tax source and cultivate and expand the main body of the market.

You just mentioned that local fiscal revenues are encountering new difficulties, and we have noticed this. Therefore, this year's increase in transfer payments from the central government to local governments is rare in many years, an increase of 18%, and the total scale has reached 9.8 trillion yuan. Tax refunds are mainly paid for by the central government, and of course, local governments also have to "make up their part". Considering the difficulties of the grassroots, our transfer payment subsidy funds to the grassroots are directly to the grassroots below the city and county level. Our local government should be an "iron rooster", not a penny of money should not be spent, not a penny of money should be given to market entities, and a single cent more is to add glory. Thank you.

As we know, since last year, the Hong Kong Special Administrative Region (HKSAR) has held elections for the Election Committee and the Seventh Legislative Council election, and this year there will be an election for the sixth-term Chief Executive. On the one hand, there is a new electoral system, and on the other hand, the epidemic situation in Hong Kong has not shown signs of improvement, and everyone is very concerned about this election. What is the Prime Minister's comment on this?

At present, the situation of the novel coronavirus epidemic in Hong Kong is severe, and the HKSAR Government has decided to postpone the election of the sixth-term Chief Executive in accordance with the law and concentrate on fighting the epidemic. The Central Government is concerned about the epidemic situation in Hong Kong every day and is very concerned about the life, health and safety of Hong Kong citizens. The HKSAR Government should shoulder the main responsibility for fighting the epidemic, and the Central Government will give full support to the fight against the epidemic.

We will comprehensively, accurately, and unswervingly implement the principles of "one country, two systems", "Hong Kong people administering Hong Kong", and a high degree of autonomy, and the re-election of the SAR Government will be carried out in strict accordance with the relevant provisions of the Basic Law. It is hoped that the HKSAR Government will unite and lead people from all walks of life in Hong Kong to continue to develop the economy, improve people's livelihood, consolidate and enhance Hong Kong's status as an international financial, trade and shipping centre, and maintain Hong Kong's long-term prosperity and stability. Thank you.

I would like to ask the Prime Minister a question about employment. At present, we have also seen some companies have unstable expectations, some industries have reduced jobs, and some companies have laid off employees. On the other hand, the number of people in need of new jobs is increasing. Prime Minister, what measures will we take this year to achieve the goal of stabilizing employment?

Employment is not only an issue of people's livelihood, but also of development. Only when there is employment can there be income, life is prosperous, and wealth is also created for the society. I remember that when I went to the company last year to conduct research, a person in charge of the company told me that in August, many employees advanced their wages to him, why did they have to pay tuition fees in September? Before the Spring Festival, I went to the rural areas of northwest China to conduct research, and the farmer told me that one of his children had to spend more than 10,000 yuan a year to go to college, and another child went to high school, and he had to earn more than 8,000 yuan a year. I am truly touched by the people of our people. They are working hard, and working and working are not only related to the current family's livelihood, but also to strive for a better future for the next generation.

This year, we have stepped up the implementation of macroeconomic policies, and fiscal and monetary policies should focus on achieving the employment target, so we emphasize that employment priority is also a macro policy, and other policies should be coordinated to work hard to achieve the employment target. Because we must now have more than 11 million new urban jobs every year, preferably more than 13 million people. I have always felt that as long as we achieve relatively full employment, we will be able to achieve what some people call the potential growth rate of China's economy. For example, when the epidemic hit hard in 2020, we did not set an economic growth target, but we set a clear target, that is, more than 9 million new urban jobs were created, and as a result, more than 11 million new urban jobs were created, and the economy not only achieved positive growth, but also a growth rate of 2.2%, which is the only one among major economies to achieve positive growth.

About 16 million new urban labor force will be needed this year, the highest in many years. There were 10.76 million college graduates, the highest in all years. Nearly 300 million migrant workers should have the opportunity to work, and they must also ensure the employment of retired soldiers. There are also some companies that live and die, and some people want to be re-employed. The new labor force in cities and towns is growing, and there must be new employment platforms. For the newly employed people, we need to provide them with training and other support measures, and use market-oriented methods to solve the employment problem. For example, in recent years, we have been promoting mass entrepreneurship and innovation, promoting the development of new technologies, new business formats and new models, and cultivating new momentum. We believe that ordinary people have superior wisdom and give full play to their strengths and wisdom, and the big stage of employment will be colorful and colorful.

Mention must also be made here of flexible employment, as there are more than 200 million people, in a variety of forms and in a wide range of areas. As a developing country, this form of employment will exist for a relatively long time. They come and go in the wind and rain, it is really hard, and many places are providing them with warm services. As a government, we must gradually improve policies on their labor rights and social security issues, that is, we must fasten "seat belts" to these "riders", so that new forms of employment such as flexible employment can not only solve urgent needs, but also stimulate market vitality and social creativity. Thank you.

It's been two years since the outbreak of the pandemic, and in the past two years, China has basically been "closed", so is China now considering making its current "dynamic zero-COVID" epidemic prevention and control policy more sustainable? Is there a roadmap for "opening up" to the world? Thank you.

The new coronavirus is the common enemy of mankind, it has been circulating for two years, the virus has been mutating, some laws still need to be studied in depth, and the corresponding such as vaccine protection and effective drug research and development also need to be strengthened. At present, the international community still needs to unite and cooperate, help each other, have more understanding and tolerance with each other, and strive to create conditions for the world to return to normal.

China has been coordinating epidemic prevention and control with economic and social development, and actively promoting international exchanges and cooperation.

Since the outbreak of the pandemic, I have had many dialogues with heads of international organizations, multinational corporations, and entrepreneurs, all of whom want to ensure the necessary business contacts. We have opened fast channels and green channels to ensure the normal production and operation of enterprises and projects in some key links. We will continue to accumulate experience, respond to possible changes in a timely manner, and gradually make the flow of logistics and people orderly and smooth. Thank you.

Hello Prime Minister. In recent years, although China's business environment has improved, the main players in the market have increased substantially, and it has become much more convenient for enterprises to do things, there are still many kinds of interference. Under the current circumstances, what more efforts will the government make to optimize the business environment and stimulate market vitality and creativity?

In the past ten years, the State Council has held a national conference every year to promote the reform of "delegating power, delegating power, and improving services" and optimizing the business environment. I have also noticed that at the beginning of this year, many localities have held meetings on the theme of improving the business environment. It can be said that the reform of "delegating power, delegating power, delegating power, and improving services" is to improve the soil for the growth of market entities, reducing taxes and fees is to fertilize and water them, and mass entrepreneurship and innovation are to promote more market entities to take root and sprout. As long as we bring into play the creativity of the people and stimulate the vitality of the main players in the market, we can imagine the vivid situation of the economy. However, the government must carry out inward reforms, not let government departments revolve around their own powers, but through reforms, let market players emerge in an endless stream and be vibrant.

It is harder to touch the interests than to touch the soul. In recent years, we have continued to promote market-oriented reforms and promote the reform of "delegating power, delegating power, delegating power, delegating power, delegating power, In the past, it took dozens of days to get a license to run a business, and it took hundreds of days at most. It is now an average of 4 days nationwide, with a minimum of 1 day in the locality. At present, about 9 percent of government services are handled online, in the palm of your hand, in different places, and without face-to-face. In fact, this is breaking the barriers of interests, so that the benefits of enterprises and the people break through the traditional thinking, and we will continue to promote the measures of benefiting enterprises and people.

In recent years, through the continuous improvement of the business environment, the number of market entities in China has reached 150 million, a net increase of about 100 million over ten years ago, mainly private market entities, of which 100 million individual industrial and commercial households. Don't underestimate individual industrial and commercial households, they are connected to the livelihood of many people on the one hand, and the consumption of the public on the other. When I was discussing at the CPPCC, those entrepreneurs said that if there were no small and micro enterprises and individual industrial and commercial households to open up the capillaries, then large and medium-sized enterprises and even state-owned enterprises and central enterprises would not be able to move.

If you go to places where economic development is good, you can see that there are strong reforms, a good business environment, and many market players, so the economy is booming. Of course, I have stressed on many occasions that "decentralization" and "management" go hand in hand, and "decentralization" does not mean delegating responsibility, but "management" is a duty that the government must fulfill. It is necessary to resolutely crack down on those acts of counterfeiting and shoddy, cheating, abduction, and deception, especially those that involve the people's lives and health and the interests of the masses, such as food and drugs, production safety, finance, and other fields, and must strengthen supervision and control, and those who violate laws and regulations must be punished. At present, new forms of business and new models are also constantly changing and developing, and we must continue to improve regulatory regulations and methods, so that market players can truly compete and develop in a fair and just environment. Thank you.

Fifty years ago, U.S. President Richard Nixon's visit to China ushered in an era of U.S. engagement with China, which was declared over by the Biden administration last year, and the U.S. and China are now entering a period of fierce competition. Do you agree with this assessment? Will bans on the sale of U.S. semiconductors in China and bans on Chinese companies listing in the U.S. become more common?

Fifty years ago, China and the United States broke the ice and embarked on a journey to normalize relations. Half a century has passed, and although there have been bumps and bumps in the relations between the two countries, they have always been moving forward. We still hope that, in accordance with the consensus reached by the two heads of state at the virtual meeting at the end of last year, the two sides will respect each other, coexist peacefully and achieve win-win cooperation, properly manage differences in a rational and constructive manner, and respect each other's core interests and major concerns. It is still necessary to have more dialogues and more communication. Since the two sides have opened the door to each other, they should not close it again, let alone decouple.

China and the United States are permanent members of the United Nations Security Council, and they are also the largest developing countries and the largest developed countries in the world. Properly handling our relations has a bearing on the well-being of the peoples of the two countries. Many of today's global challenges require China and the United States to work together to address them. It should be said that Sino-US cooperation is beneficial to both countries and the world.

Of course, there are great differences between China and the United States in terms of social systems, history, culture, and development stages, and it is inevitable that there will be differences. However, we believe that cooperation should be mainstream, because world peace and development depend on cooperation. Even if we have market competition in the economic and trade field, it should be benign and fair competition.

Last year, trade between the two countries exceeded $750 billion, an increase of nearly 30 percent over the previous year. What does this mean? The fields of Sino-US cooperation are vast and have tremendous potential. If the U.S. eases export restrictions to China, bilateral trade will be even greater, and both countries and peoples will benefit. China is ready to work with the US to choose a lenient approach and seek long-term benefits. Thank you.

Affected by the epidemic in the past two years, we found that some snack bars and small restaurants that we used to frequented in the past have not opened after they have closed their doors, and tourism, retail, passenger transport and other industries have also been greatly affected, including catering. The government work report proposes to stabilize market entities and ensure employment. Prime Minister, what measures will we take this year to help industries with special difficulties? Thank you.

After the outbreak of the epidemic, the service industry was the most affected, especially the contact service industry, of which the large number and wide range were small, medium and micro enterprises. Their foundation is already thin, and it can be said that they are careful and clear-month-to-month operations, and many difficulties accumulate to make it difficult for them to support. Helping them is actually supporting employment, because only 100 million individual industrial and commercial households have led to the employment of nearly 300 million people, and if the seedlings are dry and rooted, it will be too late to help them. Therefore, we must see that "although the scales are small, we must give them timely support".

We have introduced more than 40 support policies for these industries with special difficulties. Tax rebate alone, roughly calculated, such as catering, tourism, passenger transport, culture and other industries can enjoy 180 billion yuan. Not only do they need financial support, but they also need to provide "seamless renewal" to those with good market prospects. Moreover, if they need to reduce or waive rent and electricity bills in stages, they should also be supported by those who have the ability, which is actually the owner pulling customers.

At present, consumer demand is indeed relatively weak, mainly due to weak offline consumer demand. As you can imagine, the long alleys of the market are lined with shops and steaming, which is the bustling fireworks in the world. If it is closed, it will not be a good luck, and the lives of ordinary people will be affected. Therefore, we support these industries with special difficulties, not only to let them get through, but also to make the people's lives warm, so that our economy can show more vitality. Thank you.

As the epidemic continues to spread and cross-strait relations become more uncertain and unstable, how will the mainland respond to the situation in the Taiwan Strait and maintain and enhance the well-being of the people on both sides of the strait?

Our major policy toward Taiwan is clear, and I have already stated it in the government work report, that is, we will uphold the one-China principle and the "92 Consensus," resolutely oppose "Taiwan independence" separatist acts, and promote the peaceful development of cross-strait relations and the reunification of the motherland.

We are willing to continue to share development opportunities with the broad masses of Taiwan compatriots, provide equal treatment to Taiwan compatriots who come to the mainland for development, and do practical, good, and difficult things for them. As long as the compatriots on both sides of the strait work together in harmony and move forward in unity, they will certainly be able to promote the peaceful development of cross-strait relations and share the benefits of the rejuvenation of the Chinese nation. Thank you.

Zhang Yesui:

For the sake of time, I would now like to ask one last question.

Zhang Yesui:

Thank you Premier Li Keqiang and thank you for your attention and coverage of the conference, and this concludes the press conference. Thank you!