China to strengthen economic globalization

For decision makers in the economic domain, the top priority remains employment. Small and medium-sized companies and private enterprises contribute over 80 percent to employment in China. They are a key force supporting employment. These companies account for over 60 percent of GDP. Hence, they are also a key pillar for China's economic development.

To address the difficulties facing small and medium-sized enterprises, at the start of this year, we introduced general-benefit tax cuts worth 200 billion yuan for small and medium-sized companies, most of which are private firms.

Starting from 1 May this year, we introduced tax cuts for enterprises of various types, especially manufacturing companies, to the tune of 1.7 trillion yuan for the whole year. A large number of small and medium-sized companies stand to benefit. What's important now is to ensure full delivery of these measures.

We have noted that fiscal measures alone are not enough. Small and medium-sized enterprises and private firms still face difficulties in accessing affordable financing. And the general situation is that these companies face a visibly higher borrowing cost than big companies. We must take measures to bring down the cost meaningfully, and work toward cutting it by one percentage point this year.

We anticipated that the economic environment would be complex this year, and have rolled out a series of measures accordingly. The intensity of the current tax cuts on the fiscal front is unprecedented, and such measures are the fairest and most direct and effective. In terms of the monetary policy, we have taken care to keep it prudent and made appropriate fine-tuning when needed. We could say that the money supply is on the whole reasonably sufficient. The issue now is how to notably bring down real interest rates for small and medium-sized firms and private companies by the end of this year through effective transmission measures.

At the macro policy level, we have at our disposal such instruments as targeted cuts in the required reserve ratio and will use them when needed. We also have other financing support instruments targeting private companies and small and medium-sized firms. I believe the issue now is to make sure that these policy measures be effectively transmitted to companies.