[Premier] Li [Keqiang] reiterated the Chinese government's key policy tone -- prudent monetary policy and pro-active fiscal policy, with an emphasis on more flexibility.
To shore up growth, Li said the government had decided to raise the fiscal deficit target to 1.62 trillion yuan (263 billion U.S. dollars) in 2015, which was 2.3 percent of GDP, up from the planned 1.35 trillion yuan (2.1 percent of GDP) in 2014.
As a result, planned local government deficit will be increased to 500 billion yuan in 2015, from 400 billion last year, Li said.
Other key macro economic targets for 2015 included 3 percent for the consumer price index (CPI) and 12 percent for growth of broad money supply, or M2.
The premier said China needed to rely on both traditional and new engines to achieve 7 percent growth.
"We need to develop twin engines to drive development -- popular entrepreneurship and innovation -- paired with increased supplies of public goods and services," he said.Xinhua | Business
To this end, China will invest at least 800 billion yuan in railway construction, and another 800 billion yuan in major water conservation projects in 2015....
China Headlines: China lowers growth target, eyes better quality
6 comments:
The most important story of the decade. A rational story about China and economics instead of military? Oh dear.
Has something pulled the the world back from the brink of war so now we can focus on regular stuff again?
China To Boost Military Budget By 10 Percent In 2015
Noah Smith posted a piece on Blomberg view that directly challenges the view that I think you, Piketty, The Pope and Bill Black laid out over the last couple years about inequality and the root causes. It might signify a fork in the debate.
I've pretty much given up on reading him as well as most others that I think are a waste of time paying attention to. There's only so much time and reading conventional economics seems to me to be a waste of it. So expect me to post many fewer links to conventional economists than I have. Right now the action is on the geopolitical scene where things are unfolding fast. In fact, I view what's happening in Greece as more geopolitical than economic now. Big changes afoot.
Having successfully blown up finance and economies everywhere the Economists of all stripes are trying to become strategists and engage in geo-conflict now. The economist magazine is about half geo-politics this month. FT is filled with opinions. RAND's economists can write about little else. Forbes.. all the popular econ media is in a fervor.
It's odd how nearly all are fleeing the destruction and quackery exposed in economics that created many problems we see today, and instead are aiming higher this time. Even stranger is how groups of people become bored with one topic and enamored with another all at once. Economists tend to engage more in social media than other groups, perhaps they are the first victims of the media hype and persuasive geo-political propaganda machines that are designed to get thought leaders into action and spreading the messaging. Surely so many intelligent people could not be put to use as weapons of war and be totally unaware of their function. But who knows, given the limits of their economic ability and need for a new purpose, maybe it is desperation.
Whatever it is, if economists are the canaries in coal mine on the war hysteria, wait until the rest of the population follows along the war path that economists are blazing! Maybe unplugging from the economists is the only option, delete the bookmarks, rss and unfollow. Good luck and godspeed, all of you Quixotic adventurers, this Sancho Panza is done following econ.
And when economists get into geopolitics, as they should given how everything is interdependent and considering economic independently of historical, cultural, and institutional factors is a waste of time, then their subjective and ideological biases really show since they cannot disguise them using economic models.
Take the example of Greece. Greece is examined economically independently of one of the most significant factors in the mix, the unresolved conflict between Greece and Turkey that manifests in the division of Cyprus.
There is a reason that Greece highly values its relationship with the EU and NATO and doesn't what to give that up under any circumstances, which pretty much means staying in the EZ. Moreover, while most European countries are running behind budget on their NATO commitment, not so with Greece, which commits a significant part of its budget to military even when it is in depression.
Russia has made it clear that to receive economic aid, Greece would have to cut its ties to Atlanticist institutions, NATO in particular. Of course, Syriza is not prepared to do that, so playing the Russian card is just bluster and the Atlanticists know it. Same with China. China won't support Greece economically either and will drive a very hard bargain for any investment it commits, as it has been doing. Part of what this entails is dropping Greece worker compensation to the Chinese level.
The alternative is austerity, and in the larger picture of what Greeks consider important to them overall, TINA.
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