China’s economy “absolutely will not” suffer a hard landing, the chief of its top planning body said on Sunday, as Beijing’s leaders try to reassure global investors about the world’s second-largest economy.
Xu Shaoshi, head of the National Development and Reform Commission, made the comments to reporters on the second day of the annual meeting of the National People’s Congress (NPC), the Communist-controlled legislature.
“China’s economy absolutely will not have a hard landing,” Xu said.
“So-called ‘hard-landing’ predictions will certainly fail,” he said. “So please calm down, everyone, this possibility doesn’t exist.”
Xu said he did not believe China’s economy was weighing down the global recovery, adding that “our contribution to the world economy is very clear”.
China’s economy, a key driver of global growth, faces a litany of challenges ranging from industrial overcapacity and excess housing stock to weak trade. Billionaire investor George Soros said earlier this year a hard landing was “practically unavoidable”.
On Saturday Premier Li Keqiang set the growth target for this year in a range of 6.5-7 percent, acknowledging in a speech opening the NPC that “China will face more and tougher problems and challenges in its development this year, so we must be fully prepared to fight a difficult battle.”
Li pledged that the government would increase deficit spending this year and make much-needed cuts to the steel and coal industries.
“Domestically, problems and risks that have been building up over the years are becoming more evident,” he said.