Premier says China flexible on growth target

BEIJING (AP) -- China will keep this year's economic expansion strong enough to create new jobs but will emphasize market-opening reform and cleaning up smog-choked cities over hitting its official growth target, the premier said Thursday.

Li Keqiang's comments reinforced the ruling Communist Party's pledge to shift to cleaner, more sustainable growth based on domestic consumption and service industries instead of trade and investment.

Speaking at a news conference, Li said Beijing will keep growth in the world's second-largest economy strong enough to fulfill plans to create 10 million jobs. But he said Chinese leaders are "not preoccupied" with hitting their official target of 7.5 percent growth in gross domestic product.

"What we care more about is the livelihood of our people," Li said. "The GDP growth we want brings real benefits to our people, helps raise the quality and efficiency of economic development and contributes to energy conservation and environmental protection."

Consumer spending is rising but not as fast as Beijing hoped. That prompted the government to launch a mini-stimulus last year with higher spending on railway construction. But Li has said any further gains have to come from longer-term reforms.

Li affirmed government plans to ease tax and regulatory burdens on entrepreneurs and open markets such as health care and financial service that are dominated by the state.

"Some government departments will find fewer powers in their own hands and in boosting market competition and easing market access, some existing companies will feel greater pressure," Li said. "We will carry out reform without hesitation."

The premier was trying to strike a balance between emphasizing the leadership's shift away from growth at all costs and reassuring companies the economy would not be allowed to slow too much, said Joseph Cheng, a political analyst at the City University of Hong Kong.

Li promised to "declare war" against smog that is choking Chinese cities, and corruption, both of which are focal points of public anger at the ruling party.

China has "zero tolerance" for corrupt officials and will punish them "to the fullest extent," Li said.

However, Li gave no indication the ruling party will allow independent checks on officials, a measure anti-graft experts say would be more effective.

Li warned regulators will face punishment if environmental enforcement is found to be lax.

"We can't just sit here and wait for the wind or rain to drive the smog away," Li said.

This year's legislative meeting was overshadowed by a terror attack on March 1 in the southwestern city of Kunming just before the session opened, as well as Saturday's disappearance of a Malaysia Airlines jet with Chinese passengers aboard.

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AP Writer Gillian Wong contributed.