Prime Minister Li Keqiang is Optimist for China's Economic Recovery

By Staff Writer

Mar 30, 2016 07:36 AM EDT

Prime Minister Li Keqiang deliver keynote speech in the 15th annual Boao Forum for Asia (BFA) on Thursday. He expressed optimism that China's economy will recover, as government will do whatever it takes to reach economic growth above 6%.

Premier Li also pledged not to devalue yuan or interfere too much in its slowing economy. As Strait Times reported that Li Keqiang promised that China will fulfil its responsibility as a major economic power, even though its own economy is undergoing challenging reforms and slower growth.

"Devaluation will not lead to the production of high-quality products or promote competition and innovation," Prime Minister Li said. "We want to push out to the world increasingly better mid- to high-end products."

China will continue its economic reform under Li Keqiang, the leading figure in in Chinese economic policy. He is a well-known administrator who under previous Prime Minister Wen Jiabao was selected as Vice Premier to oversee economic development, price controls, finance, climate change, and macroeconomic management. Li Keqiang also facilitated shift of policy in Chinese government from export-led growth to a greater focus on internal consumption.

In relationship with the U.S., The Telegraph reported that China will always become United States top trading partner, as trading value between both countries are reaching $560 billion. Therefore, China will always become big interest for U.S. and vice versa. Based on the common interest, U.S. and China certainly will work together to uphold stability in the Asia-Pacific, and that interest outweigh differences between them.

In an effort to tackle China's bad loan which has reached 1.27 trillion yuan ($195 billion), Chinese government proposed a deal for Chinese banks to convert their bad debt into equity. However Bloomberg reported large banks in China resisted the plan.

Speaking in Boao, Bank of China Ltd. Chairman Tian Guoli said effectiveness of debt-equity swaps is hard to evaluate. Vice President of China Citic Bank Corp. Sun Deshun also said the same concern and stated any compulsory conversion of debt into equity would have to be capped. Meanwhile Chairman of China Construction Bank Corp. Wang Hongzhang said the bank needs to think of shareholders interest, as they would not want to see bad debt is converted into bad equity

Boao Forum for Asia was established in 2001 as a forum to promote regional economic integration in Asia Pacific. The forum was initiated in 1998 by the President of Philippines Fidel Ramos, Prime Minister of Australia Bob Hawke, and Prime Minister of Japan Morihiro Hosokawa.

Premier Li deliver his keynote speech in the annual Boao Forum for Asia (BFA) held in Hainan Island from March 22 to 25. In his speech, he tried to calm down anxiety over China's economic slowdown. 

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