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March 14, 2011 2:27 PM EDT
China needs to find the right balance between boosting employment and cooling inflation, Chinese Premier Wen Jiabao said on Monday at the end of the country's national parliament.
"There is an inseparable connection between the pace of economic development, employment and inflation. When the pace of economic development is fast, there is more employment, but inflationary pressures are also bigger," Wen told a news conference at the end of the parliament session.
"When the pace of economic development is slow, employment numbers are fewer, but it's also easy for the economy to slip into recession," he said.
"We must find a wise path between these two paths -- one that organically joins them together," Wen told a news conference at the end of China's annual parliamentary session.
China has set an official goal of 7 percent economic growth per year for 2011-2015, lower than the 7.5 percent it set for the previous five years. But those official goals have been far outpaced by double-digit growth.
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Wen's government has made a priority of cooling inflationary pressures, which leaders fear could fan discontent and erode the standing of the ruling Communist Party. Chinese inflation topped expectations in February at 4.9 percent and looks set to climb higher in coming months.
To meet a goal of keeping inflation to a 4 percent average this year, the government has raised interest rates three times and banks' reserve requirements five times since October, while also using a series of direct controls to cap price rises.
Beijing has also imposed a slew of measures to target property prices that have stayed stubbornly high.
(Reporting by Kevin Yao; Writing by Chris Buckley; Editing by Ken Wills)
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