MNI China Press Digest July 8: Growth, FX Reserves, Car Sales

The following lists highlights from Chinese press reports on Friday:

• China's economy is recovering but the foundation is not solid and arduous efforts will be required, said Premier Li Keqiang during a Thursday meeting with officials from five coastal regions, Xinhua News Agency reported. The five coastal powerhouses, including Shanghai, Jiangsu, Zhejiang, Fujian and Guangdong, account for over one third of the nation’s economy and nearly 40% of the country’s overall fiscal income. They need to continue shouldering the responsibility of helping the economy grow and ensuring China’s fiscal strength, Li was cited as saying. These areas should work hard to stabilise employment as they provide jobs for about 70% of China’s migrant workers, Xinhua said citing Li.
• China's foreign exchange reserves declined by USD56.5 billion on month to USD3.07 trillion by end-June, as the U.S. dollar index rose sharply and global asset prices fell, Securities Times reported citing Wang Chunying, deputy head of the State Administration of Foreign Exchange. A 2.9% appreciation of the dollar index in June may have bitten USD30 billion of China’s non-dollar-denominated assets, while the decline in equity assets may exceed USD10 billion amid falling bond and stock markets globally, the newspaper said citing Wen Bin, chief economist of Minsheng Bank. FX reserves will likely keep fluctuating slightly in July, as major central banks continue to hike rates, the newspaper said citing Zheng Houcheng, director of Yingda Securities Research Institute.
• China has rolled out detailed measures to boost automobile purchases, including promoting the use of electric cars, activating the second-hand car market, and supporting parallel car imports, the Securities Daily reported citing a document jointly released by 17 departments. Advisors suggest China can reduce the down payment ratio for car purchases, or implement zero down payment for the purchase of electric vehicles, as well as lower car loan interest rates and extend the repayment period, the newspaper said.