Chinese premier warns slowing growth raises job concerns

BEIJING (Reuters) - China's slowing growth poses a major challenge to job creation for the world's most populous nation and the country will need to achieve a "golden" balance between structural adjustment and growth, Premier Li Keqiang was quoted as saying on Sunday.

China's economy is set to grow at its slackest pace in 23 years in 2013, at 7.5 percent, as its export sales falter on fragile global demand.

The country's leaders have pledged deep economic reforms to shift away from an export-led economy to one more reliant on domestic consumption, while making it clear they will accept lower growth rates during the transformation. But Li said such a path would present challenges.

"China has already entered a new stage of development. To maintain a growth rate as rapid as in the past is not realistic, but development is the foundation to solving many problems," state media quoted Li as telling a recent meeting with business leaders.

"As a big country with 1.3 billion people, there is no certain pace of development that can cope with so many difficulties and problems, especially preserving jobs."

The premier added that China would need to find a "golden balancing point" between upgrading the economy and maintaining a reasonable growth rate to ensure further job creation.

China's leaders gather from November 9 to November 12 at a Communist Party plenum to discuss deepening reforms of the world's second largest economy.

Li told Chinese and foreign business leaders last week that China would further reform its government finances, financial markets and industry, among other areas.

(Reporting By Dominique Patton; Editing by Ron Popeski)

View the original article here

Indian-origin researcher warns failure to raise US debt ceiling could impair global economies

Washington, Oct. 12 (ANI): An expert in emerging global economies has stated that International Monetary Fund's warning of the US' failure to raise the debt ceiling would seriously damage the American and global economy.

Raja Kali, an economics professor at the University of Arkansas believes the impact of the shutdown thus far is relatively minor but it could produce deleterious consequences for both domestic and international financial markets.

Kali said that the real concern is the threat that Congress and President Obama will fail to raise the debt ceiling by the Oct. 17 deadline, as indicative from the reports that markets are currently waking up to the government shutdown and debt ceiling.

During the last debt-ceiling crisis, S and P downgraded the US government credit rating from AAA to AA+, which impaired investor confidence in US Treasury bonds and Kali warned that current crisis could cause similar reaction.

If the debt ceiling is not raised, the US Treasury will have difficulty paying its bills, may have difficulty paying interest and principal on Treasury securities and may be forced to renege on Social Security payments.

Kali further said that if the debt ceiling is not raised, investors may decide that US Treasury bonds are no longer the world's most secure investment and ultimately interest rates across the board will rise, as will costs for mortgages, car loans and corporate borrowing.

He further said that the crisis could cause credit markets to freeze, and the value of the US dollar to plummet and all of these consequences will cause turmoil in international financial markets and could trigger a global economic crisis. (ANI)

View the original article here