How China plans to boost its economy

Chinese Premier Li Keqiang unveiled a raft of measures to tackle China's slowing economy on March 5, including tax cuts and boosting employment.
Chinese Premier Li Keqiang unveiled a raft of measures to tackle China's slowing economy on March 5, including tax cuts and boosting employment.PHOTO: AFP

BEIJING- Chinese Premier Li Keqiang on Tuesday (March 5) unveiled a raft of measures to tackle China's slowing economy. Here are some key points.

1. Tax cuts

Beijing is reducing the tax burden on businesses significantly, slashing the value-added tax rate to 13 per cent for manufacturers, a 3 percentage point drop.

The tax rate for transportation, construction and other industries will also be cut to 9 per cent, a decrease of 1 percentage point.

Mr Li said the measure was aimed at ensuring stable economic growth and employment.

2. More infrastructure spending

The government will also invest heavily in infrastructure to stimulate the economy, pouring 800 billion yuan (S$162 billion) and 1.8 trillion yuan into railways as well as roads and waterways, respectively.

It is also spending 577.6 billion yuan on IT infrastructure.

3. Boosting employment

Beijing plans to create 11 million new jobs, and keep surveyed urban unemployment rate around 5.5 per cent.

 

To do so, it is giving businesses tax reliefs for three years if they hire the rural poor or urban residents who have been unemployed for six months.

It is also spending 100 billion yuan on a vocational skills training initiative, upgrading the skills of some 15 million people.