China Pledges More 'Fine-Tuning' in Support for Growth - Bloomberg

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By Bloomberg News - 2012-05-23T10:08:36Z

China’s leaders pledged to intensify “fine-tuning” of policies in the second government statement in four days signaling a commitment to growth as Europe’s debt crisis escalates and domestic demand slows.

“We must proactively take policies and measures to expand demand and to create a favorable policy environment for stable and relatively fast economic growth,” the government said on its website today summarizing a meeting of the State Council, or Cabinet.

The statement builds on Premier Wen Jiabao’s comments published May 20 showing a bigger focus on bolstering growth, which spurred speculation the government will step up efforts to combat a slowdown after data showed April trade and industrial production were below forecasts. Authorities this month cut banks’ required reserves for the third time since November.

The nation “must intensify precautionary adjustment and fine-tuning of policies according to changes in conditions,” the government said. Monetary policy should remain “prudent” while focusing more on “meeting demand from the real economy,” according to the statement.

China will start a series of “key infrastructure projects that are vital to the overall economy and can facilitate growth” and speed up construction of existing railway, environmental protection and rural projects, the government said today.

The Organization for Economic Cooperation and Development said yesterday that the turmoil in Europe risks spiraling and seriously damaging the world economy.

To contact Bloomberg News staff for this story: Zhou Xin in Beijing at xzhou68@bloomberg.net

To contact the editor responsible for this story: Paul Panckhurst at ppanckhurst@bloomberg.net