BEIJING, March 14 Premier Wen Jiabao said
on Wednesday that China would intensify reform of its currency
regime and allow the yuan to float more freely, while expressing
regret for what he said was unfinished work in his nine-year
Wen was speaking at the end of an annual parliament session,
the National People's Congress, which has been punctuated by
signs of a slowing economy.
The session was overshadowed by speculation about Bo Xilai,
the ambitious head of Chongqing. Bo's hopes for a central
leadership post took a blow after his subordinate, Wang Lijun,
took refuge in the U.S. consulate and left after more than a day
inside, led away by officials who put Wang under investigation.
Wen's key comments follow below:
ON THE WANG LIJUN INCIDENT:
"I can tell everyone that the central government has
attached great importance (to the Wang Lijun incident), and
immediately instructed the relevant departments to carry out a
special investigation. Currently, the investigation has made
progress, we will handle this issue in strict accordance with
the law on the basis of facts and using the law as a criterion.
"We will give the people an answer to the results of the
investigation and the handling (of the case), so that it can
withstand the test of law and history.
"Over the years, the successive governments of Chongqing and
the people in Chongqing have made tremendous efforts to promote
reform and development. And they have achieved remarkable
progress in that regard. The present Chongqing municipal Party
committee and the municipal government must reflect seriously
and learn from the Wang Lijun incident."
"I want to say a few words at this point, since the founding
of the People's Republic China, under the leadership of the
Party and the government, our country's modernisation drive has
made great achievements. Yet at the same time, we've also taken
detours and have learnt hard lessons. Since the Third Plenum of
of the 11th CPC Central Committee, in particular since the
central authorities took the decision on the correct handling of
relevant historical issues, we have established the line of
thinking and that we should free our minds and seek truth from
facts and we have formulated the basic guidelines of our Party.
In particular, we've taken the major decision of conducting
reform and opening up in China, a decision that's crucial for
China's future and destiny.
"What has happened shows that any practice that we take must
be based on the experience and lessons we've gained from history
and it must serve the people's interests. The practice that we
take must be able to stand the test of history and I believe the
people fully recognise this point and I have full confidence in
ON GOVERNMENT DEBT:
"The debt-to-GDP and budget deficit-to-GPD ratio for China
is at a fairly low level. They are both lower than many
developed countries and in emerging market economies.
"Second, government debt in China is at a controllable and
safe level. In 2010, we audited local government debts. The
level was at 10.7 trillion yuan ($1.7 trillion), and by the end
of 2011 this figure only increased by 300 million yuan.
"Third, in the handling of local government debt, we will
properly handle it and put a cap on its increase. We will
properly handle outstanding local government debt in a
step-by-step manner by classifying it into different categories
and managing it accordingly.
"For any increase in local government debt, the revenues and
expenditure must be incorporated into local government's budgets
and final accounts.
"Fourth, the majority of local government debt is actually
in the form of high-quality assets with stable cash flows and
promising returns. The debt of some projects can be repaid by
the returns on those projects.
"At the same time, we will also let the market play a role
in handling local government debt, through such ways as asset
disposal, the transfer of projects and the selling of equity.
"In a word, we will take the matter of local government debt
very seriously and we will not allow it to adversely affect
ON INCOME INEQUALITY
"We will further regulate the incomes of high-income groups,
in particular the pay and bonuses of senior management at
state-owned companies and state-owned financial institutions."
ON TIBETAN SELF-IMMOLATIONS:
"We do not agree with such extreme actions to interfere and
hurt social harmony. The young Tibetans are innocent and we feel
deeply pained by such behaviour."
"It should be clear that Tibet and the Tibetan areas of
Sichuan are integral parts of Chinese territory. The so-called
Tibetan government-in-exile in India's Dharamsala, regardless of
whether (it) is under the direct and indirect control of the
Dalai Lama, is a theocracy. Its purpose is to separate Tibet and
other Tibetan areas from the motherland. On this issue, our
position and principles are firm."
"China has no personal interests on the issue of Syria and
China does not seek to protect any party, including the
government of Syria. We make our own judgements and determine
our own position on this issue on the basis of actual facts.
"The position of the Chinese government on Syria is
four-fold. First, the lives of civilians must be protected. The
killing of civilians must be immediately stopped by all relevant
parties in Syria.
"Second, China respects the legitimate aspirations of the
Syrian people for change.
"Third, China supports the special envoy jointly supported
by the Arab League and United Nations in his mediation efforts.
"Fourth, China has deep sympathy for the humanitarian plight
of the Syrian people and we have participated in relevant
international humanitarian aid and we will continue to do so.
"At the same time China has, in its own way, worked
intensively on the relevant parties to push for a political
dialogue process. We believe that the demand for democracy by
the Arab people must be respected and truly responded to. I
believe this trend towards democracy cannot be held back by any
"There have been exchanges for the last 1,000 years between
China and the Arab people. It has been China's consistent
position to respect Islamic civilisation and support the just
causes of Arab countries.
"As the Arab world undergoes changes, I believe that the
position of the Chinese side will win the understanding and
trust of Arab countries and eventually relations and exchanges
between China and Arab countries will strengthen."
ON SOCIAL INJUSTICE:
"Of course, I know that social inequities and legal
injustice have caused the dissatisfaction of the masses. We must
continue to push forward the work on promoting social equity. In
my final year, our government will have to do several difficult
"The first thing is to develop the overall development of
the reform of the income distribution system. The second thing
is to develop and introduce the collective farmland requisition
regulations, so that farmers can truly protect the property of
their contracted land."
ON ECONOMIC GROWTH:
"We hope that the Chinese economy will achieve high quality
growth and that our economic development will serve the primary
goals of making structural adjustments to the Chinese economy
and the shift of our growth model. We hope that China's economic
growth will no longer come at the cost of resources consumption
and environmental pollution; rather we will be able to put
China's economic growth on a path that is conducive to energy
conservation and the protection of the environment.
"The economic slowdown in China is mainly the result of our
proactive macro controls. One should recognise that China's
economy is under downward pressure due to the contraction of the
external market caused by the European debt crisis. Under such
circumstances we have taken the decision to adjust downward
China's GDP growth target, mainly because we want to continue to
press ahead with our structural economic adjustment.
"If we in China can truly overcome the problem of a lack of
adequate balance, coordination and sustainability in our
economic growth, and get Chinese economic growth on the path of
quality development, this will, in a fundamental way, be good
news for the global economy. We must continue to strike a
balance between maintaining steady and robust economic
development, making economic structural adjustments and managing
ON VILLAGE ELECTIONS AND DEMOCRACY:
"I have, on more than one occasion, proposed that (we) must
unswervingly implement autonomy for villagers and protect the
legitimate rights of villagers to hold direct elections. We
should follow this path by encouraging the people to be bold in
"I believe China's democratic system will, in accordance
with China's national conditions, develop in a step-by-step way.
No force can stop this."
ON HONG KONG:
"Hong Kong faces now both difficulties and opportunities.
The global financial crisis and the European debt crisis are
still exerting an adverse impact on Hong Kong and the pressure
is still there. Moreover, Hong Kong is under the dual pressure
of slowing economic growth and inflation."
ON THE PROPERTY MARKET:
"Now, I can clearly tell everyone, home prices are still far
from returning to reasonable levels, and as such, regulation
cannot be relaxed. If they are relaxed, our achievements will
have come to naught, (it) will cause chaos in the real estate
market and will not be conducive to the long-term health and
stability of the housing market."
ON POLITICAL REFORM:
"Although our party has made resolutions on a number of
historical issues, after the implementation of reform and
opening up, the mistakes of the Cultural Revolution and
feudalism have not been completely eliminated."
"As the economy developed, it has caused unfair
distribution, the loss of credibility, corruption and other
issues. I know that to solve these problems, it's necessary to
not only enter into economic reform but also political reform,
especially reform of the Party and the state's leadership
"Reform has reached a critical stage. Without the success of
political reform, economic reforms cannot be carried out. The
results that we have achieved may be lost. A historical tragedy
like the Cultural Revolution may occur again. Each party member
and cadre should feel a sense of urgency."
"Financial cooperation between both sides of the Strait will
continue to develop, including the pushing of cooperation on
banking settlement system and encouraging banks on both sides to
take stakes in each other, to support the role of finance in
trade and economic cooperation."
ON CURRENCY REFORM:
"Since the exchange rate reform in 2005, China's real
effective exchange rate has risen by 30 percent."
"In the Hong Kong market, NDFs (non-deliverable forwards)
have started to fluctuate both ways. This tells us the yuan is
possibly near a balanced level."
"We will step-up exchange rate reforms, especially in
increasing two-way fluctuations."
"We will adhere to the principles of the Doha Round and
advocate for free trade and oppose protectionism."
ON HIS LAST TERM AS PREMIER:
"I've served as premier for the past nine years. These years
have not been easy or ordinary. But I've always felt that
there's a lot of work that has not been done, (I) have more than
a few regrets.
"Due to limited capabilities, coupled with the system and
other reasons, there are many deficiencies in my work.
"Although it is not irresponsibility that has caused
mistakes in any one matter, as the person in charge of the
country's highest administrative organ, as for the problems that
have arisen in the economy and society during my term, I bear