The macro-control policy should be stable and not to swing back and forth
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August 31 08:50:21, 2025
The Chinese economy, after a challenging climb, is now showing signs of stabilization. On the 3rd, Premier Li Keqiang delivered a keynote speech at the 10th China-ASEAN Expo, emphasizing that while the economy has remained stable in the first half of the year, it is not time to be complacent. Despite ongoing challenges, China still has the capacity and confidence to meet its main economic and social development goals for the year, laying a solid foundation for future growth and long-term sustainable development.
**Clearly Defining a Reasonable Range**
As China’s economic growth slows down, it is entering a more stable and reasonable operating range. Li Keqiang highlighted that the main goal of macroeconomic regulation is to avoid sharp fluctuations and keep the economy within a balanced range. The “lower limit†focuses on stabilizing growth and protecting employment, while the “upper limit†aims to prevent inflation.
According to the government’s work report at the start of the year, the target for 2013 was a GDP growth rate of around 7.5% and an inflation rate (CPI) of about 3.5%. Early data shows that the GDP grew by 7.6% year-on-year in the first half of the year, with CPI rising only 2.4%, well within the target. Employment remained stable, with 7.25 million new urban jobs created and over 4 million additional migrant workers employed.
Li Keqiang concluded that, overall, the economy is still within a reasonable range. Amid global economic recovery challenges and domestic structural issues, maintaining stability has provided market confidence and public expectations.
In recent months, data on CPI, PMI, trade, and industrial output have shown signs of bottoming out and stabilizing. A survey titled “Questionnaire on the Macroeconomic Situation and Policy in 2013†found that 72% of experts believe the economy is generally stable and growing at a reasonable pace. Many experts expect weaker inflation pressures and stronger consumer spending in 2013, reflecting a broadly optimistic outlook.
**Policies Should Be Stable, Not Volatile**
Experts note that with the current economic stability, macroeconomic policies must remain steady and avoid abrupt shifts. They emphasize the need for a rational policy framework that balances structural adjustment, reform promotion, and growth stabilization, while also managing employment and inflation risks.
Li Keqiang stressed the importance of making macroeconomic regulation more scientific, predictive, and targeted. Haitong Securities analysts suggest that the government is unlikely to launch a large-scale stimulus but will prepare in advance if needed.
Economist Lian Ping from Bank of Communications said that the “interval†concept reflects a policy approach of “stability and optimism.†If the lower limit is breached, the government will act decisively; otherwise, it should focus on structural reforms. This reflects a positive economic logic.
Some experts argue that while macro policies should be stable, micro-level policies need to be flexible. Wang Hongyu from the Chinese Academy of Social Sciences noted that the key is to better balance government and market roles, strengthening management where necessary and leaving others to the market.
**Relying on Transformation and Upgrading for Sustainable Growth**
The current economic stability offers a good opportunity to accelerate structural reforms and industrial upgrading. Zhang Liqun from the State Council’s Development Research Center pointed out that while there are positive signs in economic activity, care must be taken to avoid cost pressures from rising upstream prices.
Experts agree that since the economy hasn’t fallen below the “lower limit,†the current focus should be on structural adjustments, reform, and promoting transformation. Zhang Yansheng from the National Development and Reform Commission warned that without reform, China risks losing long-term growth potential and international competitiveness.
Premier Li Keqiang emphasized that China has entered a new stage of development and must rely more on transformation and upgrading. He called for changing the development model, focusing on structural adjustment, releasing reform dividends, and enhancing the role of market mechanisms to boost the vitality and sustainability of the economy.