Chinese premier says officials must adapt to ‘complex and severe’ situation

Chinese Premier Li Qiang has urged the nation’s officials to improve their ability to anticipate challenges and accurately implement policies amid a turbulent geopolitical environment.

“At present, the task to comprehensively promote the Chinese path to modernisation with high-quality development is heavy and difficult, with the external situation remaining complex and severe,” he said on Wednesday, as reported by state-run news agency Xinhua.

During this difficult period, officials needed to improve their “ability to anticipate the situation and accurately implement policies,” he added during a ceremony to swear in 49 newly appointed central government officials.

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Li’s comments come as China faces rising tensions with the West over a series of trade and technology-related issues. The country remains locked in negotiations with the United States over tariffs and export controls, and is also preparing for a major trade summit with the European Union in July.

American and Chinese officials concluded their latest round of talks in London on Tuesday, with both sides agreeing in principle to a framework designed to de-escalate a feud over rare earths and sales of strategic technologies such as jet engines.

But America will still place a total tariff of 55 per cent on Chinese goods and will not change the rate from that level, US Commerce Secretary Howard Lutnick said in an interview with CNBC on Wednesday.

Beijing has made boosting the domestic market a key priority to offset the impact of the trade war, which has impacted the country’s vast export sector.

Officials should “strengthen key work surrounding expanding domestic consumption, building a unified national market, and optimising the business environment,” Li said.

He also called on cadres to “adapt to the new requirements of developing new quality productive forces and strengthening domestic circulation”, while breaking out of previous mindsets.

Beijing has launched several initiatives to boost consumption and ease its industrial overcapacity, including a trade-in subsidy programme for consumer goods and actions to curb excessive, cutthroat competition in industries such as electric vehicles and solar power.

But deflationary pressure continues to affect the economy , with China’s consumer price index – a key indicator of inflation – staying in contractionary territory for four consecutive months.

The producer price index, which measures factory-gate prices, dropped by 3.3 per cent in May, worse than market estimates and marking the 31st consecutive month of year-on-year declines in the indicator.

The National Bureau of Statistics is due to release May macro data on Monday.

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