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Former finance minister urges supply-side reform

By Wang Yanfei | chinadaily.com.cn | Updated: 2016-11-27 19:06

China's former finance minister has stressed the need to press ahead with structural reform on the supply side to fend off corruption and low efficiency during the transformation process.

"As a key driver of global economic growth, China needs to continue to carry out structural reform on the supply side," former minister Lou Jiwei said.

Lou, who is now head of the National Council for Social Security Fund, was speaking at the annual meeting of the government-think tank International Cooperation Center.

The message sent by policy makers was that old mass stimulus measures will not boost the economy and address deeply rooted structural problems, according to Lou.

"Although sluggish demand and piling up debt after the 2008 crisis have to do with cyclical factors and the de-leveraging process, the core issues that hinder a possible robust recovery is the structural problems," Lou said. "Structural reform is the only answer."

Commenting on Chinese progress, Lou applauded past achievement and said that the Chinese government has deepened its understanding of structural problems embedded within the economy after the Third Plenary Session of the 18th Community Party of China Central Committee. He said a series of measures had been taken that "fit the need" of the demand for global structural reforms in the international community.

Despite much progress, Lou said efforts to implement reform need to be strengthened at a time when low efficiency and corruption might emerge while the government is transforming its role as a direct manager of market resource allocation to an indirect governor of the economy under a market economic scheme.

"We must take precautions against risks and continue to press ahead with structural reforms with no hesitation," Lou said.

A veteran of the nation's tax bureau, Lou stepped down from the position as finance minister earlier this month and later was appointed as head of National Council for Social Security Fund.

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