Chinese leaders pledged fine-tuning to ensure stable and more balanced growth while fighting inflation, ending a top-level economic planning session without major shifts in policy.
But coping with the deepening slowdown will likely require strategies that go beyond the tinkering suggested in the summary from the annual economic work conference in Beijing, which ended Wednesday.
As expected, the annual economic work conference endorsed the ruling communist party's agenda for keeping a "prudent" monetary policy to counter inflation and a "pro-active" fiscal policy to support growth.
The gathering also pledged to keep curbs on the property sector in place to guard against a rebound in prices, and called for keeping the value of China's currency, the yuan, "basically stable," according to a statement issued by the official Xinhua News Agency.
The statement gave no specifics. State media cited Commerce Ministry officials saying that the government plans to prop up falling exports by setting up special trade "bases" and aiding exporters in inland areas, which have lagged behind the richer coastal regions.
Tax cuts and increased government spending in key areas such as high-tech and energy are also likely, though analysts say they do not expect stimulus comparable to the 4 trillion yuan ($586 billion) package deployed in response to the 2008 global crisis.
By targeting specific sectors, authorities aim to prevent the sort of runaway investment, driven by bank lending, that drove inflation to 6.5 percent in July and has left housing prices prone to inflate into financially risky bubbles.
The cautious strategy touted by China's economic planners did little to reassure gloomy investors, who over the past five days have pushed the benchmark Shanghai Composite Index to its lowest level since March 2009. The index fell 0.9 percent Wednesday to 2,228.53
"The prudent economic policy did not match investors' earlier expectations," said Li Jianfeng, an analyst at Caida Securities, based in Shanghai.
With labor unrest flaring and financial conditions deteriorating across many sectors, from small companies to government-backed building projects, the mantra is "stability."
That word was repeated five times in just one sentence of the official dispatch that vowed continuity in policies for the sake of keeping social stability.
The work conference report pointed to "unsustainable contradictions, downward pressure on growth and inflationary pressures," among a litany of risks, and urged "heightened awareness and a greater sense of urgency regarding the opportunities and risks to the country's development from the global financial crisis."
An expected transition next year to a new generation of communist leaders has accentuated Beijing's obsession with keeping control.
China's economy grew 9.1 percent in July-September but is expected to slow to below 9 percent growth in the coming year, as weaker demand at home compounds the impact from fragile conditions in Europe and the United States.
Export growth has fallen steadily since hitting a peak of nearly 36 percent in March, and economists are forecasting foreign trade will actually be a drag on growth next year.
Given the weakness in demand for Chinese exports overseas, the leaders reiterated their intention to boost domestic demand to build an economy less dependent on foreign trade and investment.
There was no indication of any intention for major shifts in Beijing's currency policy, a source of tension with the U.S. and other trading partners who say the yuan is undervalued, making Chinese goods relatively cheaper overseas.
The statement said China would continue with reforms to make the currency more "market oriented" while also gradually adjusting its controls on interest rates and other financial mechanisms and fine-tuning monetary policy in a "timely and appropriate way."
Researchers Fu Ting in Shanghai and Yu Bing in Beijing contributed.
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