Premier Zhu Rongji has pledged more government spending on welfare and income support to cushion job losses and cuts in farm income as China’s economy adjusts to international competition within the World Trade Organisation. Speaking to the National People’s Congress, he said the government would help workers who lost jobs in uncompetitive industries. He also promised measures to boost farmers’ incomes and protect them from competition, without breaking WTO rules.
Finance minister Xiang Huaicheng told the congress that spending in 2002 on social security would increase by 28 per cent to Yn86bn in order to ensure benefits for jobless and retired workers. Spending on rural infrastructure and agriculture would also increase, with Yn27.4bn to help make Chinese farmers more competitive.
Zeng Peiyan, minister in charge of the State Development Planning Commission, said that the government would try to create 8m jobs this year in order to keep the official urban unemployment rate down to 4.5 per cent. Even this level would be up from 3.6 per cent in 2001 and 3.1 per cent in 2000. Solving the problem of unemployment would be moved to the top of the agenda.