Chinese premier says economy faces great challenges, new uncertainties

Unemployment rate estimated at around 4.99 per cent
||Last Updated: 02/16/2016

BEIJING (Reuters) — China's economy faces great challenges and new uncertainties brought about by the global economic environment and various countries' ailing stock markets, Premier Li Keqiang said on Monday.

As well as maintaining stable levels of employment, China must be highly vigilant and maintain financial market stability, Li said.

In rare criticism of how officials handled last year's stock market rout and yuan volatility, Li said top regulators did not respond sufficiently, did not react in a timely and effective way, and had internal management issues.

But he defended the measures taken to stabilize markets, saying those policies had fended off systematic risks.

Li's comments come at a crucial time for China as the country seeks to invigorate economic growth with broad financial reforms.

China reported economic growth of 6.9 per cent for 2015, its weakest in 25 years. A slew of economic indicators has sent mixed signals to markets at the start of 2016 over the health of China's economy.

"The current international market's continued downturn puts great pressure on China's economy," Li said.

But he said there was still great potential and plenty of room to maneuver given the country's high savings rates.

Li also said China's so-called survey-based unemployment rate was at 4.99 per cent in January.

"China's economic fundamentals are stable as long as employment is stable," Li said. "This is the biggest bright spot in China's economy."

The National Bureau of Statistics has said China's survey-based unemployment rate was at 5.01 per cent at the end of 2015. The official jobless rate is published by the Ministry of Human Resources and Social Security.

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