China PM blasts trade protectionism, pressure on yuan
Prime Minister Wen Jiabao blasted trade protectionism by China's trading partners on Sunday and vowed not to yield to pressure to allow the Chinese yuan to appreciate.
In an Internet interview with Xinhua news agency, Wen said he would continue to implement macro-economic policies next year aimed at stimulating growth and fighting the global financial crisis, but would also rein in credit and curb rising land prices.
"The pressure on the yuan to appreciate is bigger and bigger... we have been getting this and that kind of pressure to appreciate, but we refuse to yield," Wen said in the webcast.
"I told foreign friends, I said, 'you are asking for us to allow the yuan to appreciate, while at the same time adopting all kinds of trade protectionism, actually you are trying to restrain China's development'."
The value of the Chinese currency, which has effectively been pegged to the US dollar since mid-2008, has been a bone of contention between Beijing and its Western trading partners, which say it is kept low to boost exports.
"This could be a big issue facing us next year in our economic work," Wen said in what he promised would become an annual webcast with Xinhua.
But he added: "I believe this year as major currencies around the world devaluated, that maintaining the value and stability of the yuan was a contribution to the international community."
He also lambasted a series of World Trade Organization disputes that have been filed against China this year, saying there were more such actions taken in 2009 than ever before.
"They are using every kind of trade obstacle, which is really placing a lot of pressure on China's overseas oriented industries, especially exports," Wen said, without naming nations.
Meanwhile, China would continue to prime pump the economy in 2010 after last year's four-trillion-yuan (586-billion-dollar) stimulus package and policy efforts to boost domestic spending during the global slump, he said.
"After a year of efforts by the people of our nation, we have stabilised the economy, stabilised employment and maintained social tranquility," he said.
"But the financial crisis is not over, there is still a lot of work to be done... ending our economic stimulus policies too early could spoil all that has been achieved and even worsen the situation."
Wen further added that his government would crack down on illegal activities that were driving property prices upward, and seek to rein in runaway bank credit that could increase inflationary pressures.
"As the property market is recovering rapidly this year, housing prices in some cities are rising too fast, which deserves the serious attention of the central government," Wen said.
"We will crack down on illegal activities, including hoarding of land, driving up housing prices and delaying sales for bigger profits."
He acknowledged the role of easy bank credit to ward off the global crisis, but said the scope of banking loans was too large and needed to be slowed.
"It would be good if our bank lending was more balanced, better structured and not on such a large scale," he said.
China's economy grew by 8.9 percent in the third quarter -- the fastest pace in a year -- after expanding by 7.9 percent in the second quarter and 6.1 percent in the first three months, the slowest pace in more than a decade.
Last month, the World Bank upgraded its 2009 growth forecast for China to 8.4 percent on the back of huge public spending but said stronger domestic demand was needed to ensure a sustainable recovery.
Prime Minister Wen Jiabao blasted trade protectionism by China's trading partners on Sunday and vowed not to yield to pressure to allow the Chinese yuan to appreciate.
In an Internet interview with Xinhua news agency, Wen said he would continue to implement macro-economic policies next year aimed at stimulating growth and fighting the global financial crisis, but would also rein in credit and curb rising land prices.
"The pressure on the yuan to appreciate is bigger and bigger... we have been getting this and that kind of pressure to appreciate, but we refuse to yield," Wen said in the webcast.
"I told foreign friends, I said, 'you are asking for us to allow the yuan to appreciate, while at the same time adopting all kinds of trade protectionism, actually you are trying to restrain China's development'."
The value of the Chinese currency, which has effectively been pegged to the US dollar since mid-2008, has been a bone of contention between Beijing and its Western trading partners, which say it is kept low to boost exports.
"This could be a big issue facing us next year in our economic work," Wen said in what he promised would become an annual webcast with Xinhua.
But he added: "I believe this year as major currencies around the world devaluated, that maintaining the value and stability of the yuan was a contribution to the international community."
He also lambasted a series of World Trade Organization disputes that have been filed against China this year, saying there were more such actions taken in 2009 than ever before.
"They are using every kind of trade obstacle, which is really placing a lot of pressure on China's overseas oriented industries, especially exports," Wen said, without naming nations.
Meanwhile, China would continue to prime pump the economy in 2010 after last year's four-trillion-yuan (586-billion-dollar) stimulus package and policy efforts to boost domestic spending during the global slump, he said.
"After a year of efforts by the people of our nation, we have stabilised the economy, stabilised employment and maintained social tranquility," he said.
"But the financial crisis is not over, there is still a lot of work to be done... ending our economic stimulus policies too early could spoil all that has been achieved and even worsen the situation."
Wen further added that his government would crack down on illegal activities that were driving property prices upward, and seek to rein in runaway bank credit that could increase inflationary pressures.
"As the property market is recovering rapidly this year, housing prices in some cities are rising too fast, which deserves the serious attention of the central government," Wen said.
"We will crack down on illegal activities, including hoarding of land, driving up housing prices and delaying sales for bigger profits."
He acknowledged the role of easy bank credit to ward off the global crisis, but said the scope of banking loans was too large and needed to be slowed.
"It would be good if our bank lending was more balanced, better structured and not on such a large scale," he said.
China's economy grew by 8.9 percent in the third quarter -- the fastest pace in a year -- after expanding by 7.9 percent in the second quarter and 6.1 percent in the first three months, the slowest pace in more than a decade.
Last month, the World Bank upgraded its 2009 growth forecast for China to 8.4 percent on the back of huge public spending but said stronger domestic demand was needed to ensure a sustainable recovery.