Adapt new norm to spur growth: Xi Jinping

BEIJING: China should adapt a "new norm" for its economic growth and be "cool-minded" in dealing with it amid slowdown in the world's second-largest economy, President Xi Jinping has said.

"China is still in a significant period of strategic opportunity. We must boost our confidence, adapt to the new normal condition based on the characteristics of China's economic growth in the current phase and stay cool-minded," Xi said while touring central Henan Province yesterday.

From the heydays double digit growth the world's second largest economy had declined to 7.7 per cent in both 2012 and 2013, the slowest pace since 1999 largely affected by the world economic crisis and declining exports due to global slowdown.

While the decline continued, the new leadership headed by Xi ruled out massive stimulus like it did in the 2008 amounting to $645 billion to aver the economy.

Instead the Chinese leadership says it focussed more on further reforms and opening up giving private sector bigger play.

Also, it formed a Shanghai Free Zone much on the lines of the successful Shenzhen FTZ launched three decades ago to spur growth.

Playing down the concerns over the slow down, Xi said China should attach great significance to preventing diversified risks for its economy and take timely countermeasures to reduce potential negative effects.

"The basic conditions for sustaining the country's growth have not changed, so we should stick to the fundamental principle of seeking progresses while maintaining stability in economic work," he said.

The government must continue to coordinate the relations of stabilizing growth, promoting reforms, adjusting structure, improving people's livelihood and preventing risks so as to ensure sound economic growth and social stability, Xi was quoted as saying by the state-run Xinhua news agency.

Earlier, China's central bank governor Zhou Xiaochuan said that macroeconomic policies should be stable and no massive stimulus should be taken at present.

Zhou urged for more accurate judgment about the present economic situation, arguing that short-term economic figures may not be sufficient to help come to conclusions.

China's economic growth slowed to a six-quarter low of 7.4 per cent in the first quarter of the year, down from a growth of 7.7 per cent in the final quarter of 2013.

In spite of the slowdown, the pace was within a reasonable range, as the government has set the annual growth target for this year at about 7.5 per cent.