A limited economic boost announced by China recently does not mean Beijing is about to rein in reform, the official Xinhua news agency reported Thursday.
The mini stimulus is intended to strengthen the foundation for reform and fine-tune its pace as an overly fast or slow economic growth is risky, the report said.
In June 2013, Barclays Capital coined a term for Premier Li Keqiang’s economic plan — Likonomics — which stressed no stimulus, deleveraging and structural reform.
However, the term has been misinterpreted that micro stimulus contradicts economic reform, the report said.
In order to press ahead with structural reform, there has to be a sound macroeconomic environment which will allow the government to tackle issues such as debt, shadow banking and property risks.
Nevertheless, Beijing is unlikely to return to strong government stimulus to bolster slowing economic growth, the report said.
On May 30, the State Council announced measures to ensure a supporting role for the financial sector in the economy including expanding the use of targeted reserve requirement ratio for banks following the policy of lending to rural and small businesses.
China hopes the micro stimulus measures will stabilize economic growth during the reform process, the report said.
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