China able to maintain balance while reducing risk, premier tells IMF chief

Premier Li Keqiang meets with Christine Lagarde, managing director of the International Monetary Fund, in the Great Hall of the People in Beijing on Sunday. LIU ZHEN / CHINA NEWS SERVICE

China is capable of maintaining financial stability and will strike a proper balance－reducing leverage rates while sustaining economic growth－and the government's top priority will be preventing financial risk, Premier Li Keqiang said on Sunday.

Li made the remark in a meeting with Christine Lagarde, managing director of the International Monetary Fund, who is in Beijing to attend the two-day Belt and Road Forum for International Cooperation, which started on Sunday.

Li expressed China's willingness to enhance its policy communication with the IMF, advocating a more globalized economy and fostering international trade and investment.

He also said China will keep a managed floating exchange rate system based on supply and demand.

Lagarde expressed her thanks to Li for China's support of the IMF, from multilateralism to international cooperation and trade. She said the IMF is willing to continue to enhance its communication and cooperation with China.

Lagarde said that while China has experienced encouraging economic growth, it has adopted a prudent approach to financial regulation and has a sound financial system.

The IMF upgraded its forecast for China's economic growth in its latest outlook in mid-April. It now expects growth of 6.6 percent in 2017, 0.1 percentage point higher than its January forecast.

An IMF statement following the report said the upward revision is the result of China's strong growth momentum and anticipation of continued policy support.

The report also raised its forecast for the global economy by 0.1 percentage point from its January projection. IMF Chief Economist Maurice Obstfeld said the improvement is due primarily to good economic news for Europe and Asia, and within Asia for China and Japan.