Premier Li Keqiang has stressed on Jan 9 the importance of efforts to keep China’s economy in an appropriate range in 2019.

He made the comments during a State Council executive meeting.

In the second half of last year, China experienced an economic slowdown, and maintaining a stable economy in the first quarter is crucial for 2019, he said.

The government has rolled out three measures to keep China’s economy in an appropriate range, according to the Premier at the meeting.

Decisions were made at the meeting to speed up the issue and use of local government bonds and roll out more inclusive tax cuts for micro and small enterprises (MSEs).

Another move was the comprehensive reduction of the reserve requirement ratio, announced by the People’s Bank of China on Jan 4.

The decision was made after Premier Li visited the Bank of China, the Industrial and Commercial Bank of China and China Construction Bank on Jan 4.

At a symposium at the China Banking and Insurance Regulatory Commission after the inspection, Premier Li stressed the role of counter-cyclic adjustments in macro policy as well as further measures to reduce taxes and fees.

The comprehensive and targeted reduction of the reserve-requirement ratio should be used to support financing for small and micro-sized enterprises, the Premier said at the symposium.

Five days later at the executive meeting, Premier Li said the reduction did not indicate a diversion of monetary policy, and China will maintain its prudent monetary policy with fine tuning to stabilize market expectations.

He stressed that the People’s Bank of China and financial institutions should cut reserve requirement ratios in both comprehensive and targeted ways, making it beneficial to enterprises with difficulties in loan application or with high loan rates.

According to the meeting, local government bonds worth 1.39 trillion yuan authorized by the National People’s Congress will be issued, and the distribution of special bonds of the year will be initiated soon.

The Premier emphasized that funds raised through special bonds will support ongoing and planned key projects and address delayed payments.

The meeting on Jan 9 also decided to relax the requirements on MSEs that can enjoy preferential corporate income taxes and increase the scale of the tax cuts.

The policy is recognized as a large-scale tax cut, which is expected to stimulate the vitality of the market and ensure stable employment.

It is estimated that 95 percent of taxpaying enterprises will be included and 200 billion yuan will be saved.

The Premier also urged all departments to take responsibility for maintaining the economy this year.

General expenditures of governments at all levels must be limited with the budget this year, the Premier said.