China’s annual two-day closed door economic policy-setting conference has concluded with a cautious weather eye again being cast to the squalls of the global economy next year. Policy will be kept as is, not unexpectedly, but with room for maneuver in both fiscal and monetary policy reserved should the global economy deteriorate.
Rising protectionism, inflation and asset bubbles are listed as the main risks along with the longer running lack of demand in China’s export markets in the rich countries. Beijing will target 7.5% GDP growth for 2013, the same as this year. Monetary policy will remain modestly expansive, with a hand being kept on the bank lending and public spending taps ready to open or close them a turn as necessary. Property controls will remain and the yuan held steady.
The conference seems to have said all the right things about economic reform. The country will push forward with the next stage of economic reforms “with greater political courage and wisdom,” state media reported. That, though, is more difficult to deliver than economic targets.