Chinese premier Li Qiang seeks to reassure global investors at Davos
China's premier Li Qiang assured investors and politicians gathered at Davos on Tuesday that the world's second-largest economy has "huge potential" and remains an "important engine" of global growth, despite the serious economic headwinds the country has seen over the past year.
Why it matters: The remarks come as confidence in China's economy among global investors has fallen to a historic low amid a real estate crisis, heavy local government debt, unemployment, deflation, and weak consumer demand. At the same time, the U.S. and like-minded democracies have sought to delink sensitive supply chains from Chinese manufacturing.
- Li, who as premier is second to Chinese leader Xi Jinping, is the highest ranking Chinese official to speak at Davos since Xi Jinping's 2017 address.
- Li brought along a large delegation of business leaders and government officials, and is combining his appearance at Davos with an official visit to Switzerland.
The big picture: In the past year Xi has adopted a less hostile tone toward the U.S. and other western countries as he has sought to secure international trade and markets for China and to turn back the tide of restrictions on Chinese technology.
What he's saying: "As the second largest economy in the world, China has established sound and solid fundamentals," Li said. "The Chinese economy can handle ups and downs in its performance. The overall trend of long-term growth will not change."
- Li said the economy grew 5.2% in 2023 — a previously unreleased figure — in what appeared to be a preview of 2023 economic data not yet released by the government. That number is higher than the 5% growth goal set by China's leaders for 2023, he said.
- Li also touted China's "supersize market," its highly skilled and educated workforce, its global leadership in electric vehicles, and its huge and still rapidly growing middle class.
Li also obliquely criticized U.S. policy toward China, calling for a "non-discriminatory environment" for science and technology exchange and stating that "discrimination" in global industrial supply chains "compromises development efficiency but also triggers various risks and economic problems."
- The U.S. has taken a raft of measures in recent years to insulate U.S. advanced technologies from what it says is Chinese state-backed espionage and intellectual property theft.
- Those measures include placing restrictions on Chinese access to U.S. technology and limiting some research collaboration with China.
Between the lines: Li is a close ally of Chinese leader Xi Jinping.
- Previously the party secretary of Shanghai, Li was selected as premier last fall, succeeding Li Keqiang, who held similar pro-business views as the current premier but was not a protege of Xi.