China's Politburo pledges to prevent 'systemic' financial risks

[BEIJING] China's Politburo, the Communist Party's top decision-making body, said Beijing will implement a "proactive" fiscal policy and "prudent" monetary policy in the second half of the year, the official Xinhua news agency reported on Monday.

China will also strengthen coordination of financial regulation, stabilise the property market and prevent systemic financial risks, according to a statement following the meeting chaired by President Xi Jinping.

"While fully affirming economic performance, we must at the same time clearly recognise the many problems and contradictions in the economy," the meeting decided, according to Xinhua.

The meeting also stressed the need to address debt risks.

"We must actively and steadily resolve built-up government debt risks, effectively regulate local government debt financing, and resolutely curb the increase in hidden debt," the statement issued after the meeting said.

The statement's themes were reiterations of past declarations of government policies. Chinese officials have regularly declared their determination to tackle debt and other issues while still maintaining solid economic growth.

Monday's statement gave no details of any new policies. Economists take "proactive" fiscal policy to mean an increase in government spending.

On July 17, China reported annual economic growth of 6.9 per cent in the second quarter, slightly above expectations.

REUTERS