Premier Li: China to implement macro policies for stable business, employment
Updated 10:55, 22-May-2020

China will forcefully implement macro policies to keep businesses and employment stable, Premier Li Keqiang said on Friday.

Li made the remarks while delivering a government report at the opening meeting of the third session of the 13th National People's Congress (NPC).

The premier said that to ensure employment and people's well-being, China must instill confidence in over 100 million market entities and must do its utmost to help enterprises, particularly micro, small and medium businesses and self-employed individuals get through this challenging time.

Li also talked about cutting 500 billion yuan in taxes and fees, pointing out that the government will aggressively implement current policies in conjunction with institutional arrangements to create a more enabling environment and help market entities overcome difficulties and achieve development.

The policies introduced early this year that are due to expire by June will all be extended until the end of the year, said the premier. "They include the following: Exempting micro, small and medium businesses from contributions to basic old-age insurance, unemployment insurance and work injury compensation insurance schemes; reducing or cancelling VAT for small-scale taxpayers; exempting VAT on services such as public transportation, restaurants and hotels, tourism and entertainment and culture and sports; and reducing or cancelling civil aviation development fund contributions and port development fees.”

The government expects that these measures will save enterprises an additional 2.5 trillion yuan throughout the year.

In order to let businesses to sustain their development and ensure success for the future, all tax and fee reduction policies must be fully implemented for the businesses.

Enterprises' production and operating costs will also be reduced, said the premier.

"The policy of reducing electricity prices for general industrial and commercial business by five percent will be extended to the end of the year. The rates for broadband and dedicated internet access service will be cut by 15 percent on average. Rents for state-owned premises will be lowered or exempted, and all other types of property owners are encouraged to also reduce, waive or defer rent payments, and they will receive policy support from the government in doing so."



Meanwhile, China will increase financial support to keep business operations stable.

"The policy allowing micro, small and medium business to postpone principal and interest repayments on loans will be further extended to the end of March next year, payments on all inclusive loans of micro and small businesses eligible for this policy should also be deferred and other businesses facing financial difficulties can discuss similar terms with their creators," said Li.

The government encourages banks to substantially increase credit loans, first-time loans and loan renewals without repayment of principal for micro and small business.

Large commercial banks should increase inclusive finance lending to micro and small businesses by more than 40 percent.

The premier vowed to make every effort to stabilize and expand employment, saying that the government will increase employment support for key sectors and key groups.

"With 8.74 million college students graduating this year, we need to encourage market-based employment and ensure that colleges and local governments provide employment services to those students on an ongoing basis.”

Military personnel, rural migrant workers, people with disabilities, zero-employment families and other groups facing difficulties in finding jobs were all mentioned in the government work report.

On low-income earners, Li said that they will be allowed to postpone the payment of their social insurance premiums and all employment-related government charges will be cancelled.

"We will finance skills training to stabilize employment this year and next; more than 35 million vocational skills training opportunities will be provided and enrollment in vocational colleges will grow by two million," Li said.