INTRODUCTION

China’s annual parliamentary session wrapped up with the passage of a controversial resolution to craft a national security law for Hong Kong, and a pledge to boost the economy which has been hit by the Covid-19 pandemic.

The National People’s Congress – which is usually held in March but was delayed because of the pandemic – concluded with an endorsement by lawmakers of Premier Li Keqiang’s government work report which, for the first time, did not set a GDP growth target.

The congress wrapped up amid heightening tensions between the US and China, with the Trump administration telling Congress just one day earlier that Hong Kong was no longer suitably autonomous from the mainland.
Li held a press conference to mark the end of the parliamentary session. This is the South China Morning Post’s live coverage.

Li’s key points

The main points from Li’s press conference:

The central government will stick to the principle of “one country, two systems”, and “Hong Kong people governing Hong Kong” with a high degree of autonomy. The NPC’s resolution for a national security law for Hong Kong is designed to safeguard “one country, two systems” instead of abandoning it.

China supports scientific efforts to investigate the origins of the coronavirus. No cover-up of the outbreak will be allowed.
On China-US tensions, China rejects a “Cold War mentality” and the two nations should promote cooperation, such as the investment in Wuhan by a hi-tech US company.

In his government work report, Li omitted the word “peaceful” when talking about Taiwan. But he said at the press conference that “peaceful reunification” was still Beijing’s policy and the mainland was open to further exchanges with Taiwan.

Even though the central government did not set a GDP growth target, China will implement new measures to boost growth.

What went unsaid

Li ended the press conference by stressing that China was “an enormous market”, and a place that the world should still see as a good investment.

He said China would boost imports, and the world should work together to combat the pandemic.

But he did not address ongoing anti-government protests in Hong Kong, or respond to US Secretary of State Mike Pompeo’s announcement on Thursday that Washington no longer considered Hong Kong to be autonomous from Beijing.

He also did not refer to a tense stand-off between China and India in the Himalayas, the Belt and Road Initiative or China’s relations with Europe.

External uncertainties

On the difficult and unpredictable external factors faced by China, Li said the pandemic had hit the world severely, greatly reducing exchanges between countries.

If conditions persisted, there would be more dangers to the global economy, which could undermine efforts to contain the coronavirus.

Combating the virus required an open economy to ensure the supply of goods for public health, he said.

He said China would to continue to open up and maintain the stability of the supply chain.

Rise in pensions

Li said that given the tough economic times, Beijing would expand coverage of subsistence allowances and unemployment benefits as well as increase pensions for the elderly.

“There can be no loopholes - if there are any gaps, then this will make people feel there is no hope for the future,” he said. “As the saying goes, the people are the foundation of a state and when the foundation is solid, the state enjoys tranquility.”

Ending poverty

Li said that even with the fallout from the coronavirus pandemic, the country was still determined to reach its goal of eliminating poverty by 2020.

He said there were some 5 million people living below the poverty line before the outbreak, and more may have fallen below it since then, making eliminating poverty a “daunting task”.

Questions

So far Li has taken nine questions, of which four were from foreign media, one was from Hong Kong and one from Taiwan.
Even though the main focus of the NPC is the national security legislation for Hong Kong, only one question raised at the presser has been about the city.

‘Let businesses flourish’

Li said the central government must work hard to help business flourish, aiming at having 10,000 new enterprises registered each day.

The government must get rid of all unnecessary restrictions on the market, foster fair competition and create tangible wealth, he said.

He said there had been a surge in new kinds of businesses, such as online platforms, during the pandemic, and some of these businesses had seen their revenue grow by two-thirds.

China-US tensions

On escalations in China-US tensions and speculation about a new Cold War, Li acknowledged new challenges between the two countries, but said there was room for bilateral cooperation, including on the economy and technology.

Their relationship could be either mutually beneficial or mutually harmful, he said.

Decoupling was not good for either country or the world, Li said.

Referring to a phase one trade deal reached in January, Li said the two countries should continue to follow through on the consensus reached by the leaders of both countries.

He said trade and economic cooperation should be based on market forces. There were differences in each other’s systems, and conflicts were inevitable, but the key was how to handle the problems.

We need to mutually respect each other’s core interests and search for areas for cooperation, Li said.

The US had in recent days issued a strategic policy that appeared to signal that Washington had abandoned its engagement policy towards Beijing.

He also spoke of new investment by a hi-tech US company in the central Chinese city of Wuhan, an example he said reflected the importance of business ties and cooperation between the countries.

Li had earlier sent a congratulatory letter to the company, the US conglomerate Honeywell.

Hong Kong and the national security law

Asked whether the NPC’s resolution for a national security law for Hong Kong meant that Beijing had abandoned the “one country, two systems” model for Hong Kong, Li said the law was to secure the long-term stability of “one country, two systems”.

He said that “one country, two systems” and a high degree of autonomy were long an important part of Beijing’s basic state policy, and had been implemented from the start.

He said the national security law resolution was designed “for the steady implementation of one country, two systems and Hong Kong’s long-term stability and prosperity”.

Growth for jobs

Li said growth would be needed to support job creation, one issue of greatest public concern.

About one-third of recent comments left on the State Council’s website were on employment.

China was committed to helping businesses survive and retain jobs, he said.

University students are expected to graduate and enter the workforce in record numbers this year.

‘No change’ on Taiwan

Li said that Beijing’s cross-strait policy would not change, and that the mainland Chinese government was open to further exchanges with Taiwan to move forward on “peaceful reunification” with the self-ruled island.

He rejected all “Taiwanese independence forces” and external interference in Taiwan.

He said Beijing remained committed to the 1992 consensus – the political understanding that there is only “one China” but that each side has its own understanding of what this means.

Li’s work report this year did not refer to the 1992 consensus and omitted the word “peaceful” in the phrase “peaceful reunification”, which some feared signalled a more hawkish stance from Beijing on Taiwan.

Last week, Taiwanese President Tsai Ing-wen officially started her second term, after a landslide election win in January that many saw as an endorsement of her harder stand against Beijing.

Li said Beijing would continue to pay high attention to the island, adding that no Taiwanese died from the coronavirus in mainland China.

Jobs – not infrastructure

Li said the government’s measures to counter the coronavirus would focus on employment and livelihoods, and not infrastructure construction.

About 70 per cent of the funds would support people’s income and boost consumption.
Smaller firms would also be targeted for support.

“The central government will live on a tight budget,” Li said.

‘No cover-up allowed’

Li said China had successfully controlled the coronavirus within its borders and Beijing had acted in a transparent and timely manner throughout the pandemic.

“No cover-up will ever be allowed,” he said.

Li said there were two main challenges in the pandemic: controlling the virus outbreak and reopening the economy. International cooperation was important for both.

“We may have to live with Covid-19 for some time to come,” he said.

Coronavirus inquiry

In response to a question about the origins of the coronavirus and calls for an independent international inquiry into the pandemic, Li said that China also believed it was important to find the source of the pathogen.

Li said that getting a clear, scientific understanding of the source of the virus could contribute to global public health.

He also referred to the World Health Assembly’s endorsement of an independent review into the World Health Organisation’s handling of the pandemic and its animal origins.

Li said the virus had no borders and much was still not known about it, adding that the international community needed to work together to keep the virus in check and create a vaccine.

Beijing and Washington have sparred over the origin of the virus, and earlier the Chinese foreign ministry condemned the US and Australia for their calls of an independent investigation into Beijing’s response to the pandemic.

The US has accused Beijing of cover-ups and a lack of transparency, while a Chinese foreign ministry spokesman suggested earlier that the US could be the origin of the virus.

Li said Beijing was open to international cooperation on research and development for a vaccine. Washington has accused China of seeking to steal its vaccine research, a charge that Beijing has strongly rejected.

Economic stability

The cabinet is determined to stabilise the economy, according to Li.

“If there are big changes, we still have policy room, including on the fiscal, financial and social security fronts,” he said.

“We are confident that under the strong leadership of [President] Xi Jinping and with joint efforts across the nation, we will be able to prevail in the difficulties and achieve the goal of building a moderately prosperous society.”

Coronavirus and the economy

Li said the Chinese economy was deeply integrated into the global economy, so China would not be immune from the impact of the coronavirus.

Economic development remained key to solving China’s problems today, Li said.

He said that even though the Chinese government did not set a GDP target, it had defined six areas of focus to help China achieve growth.

China’s measures to counter the coronavirus were forceful and well-focused, Li said.

Li arrives

Li starts his annual press conference by saying that the restrictions imposed for Covid-19 will not affect his communication with the media.

Resolution passed

Earlier, Li Zhanshu, chairman of the Standing Committee of the National People’s Congress, presided over a near-unanimous vote to pass a resolution on a national security law for Hong Kong that would ban separatism, subversion, foreign interference, and terrorism in the city.

The votes were 2,878 in favour, one against, six abstentions, and one who did not press the button to vote.

Critics say the move to enact a national security law will end the “one country, two systems” model in Hong Kong. The United States said on Thursday that Hong Kong was no longer autonomous from China, a decision that could end the city’s special trading status with the US.

Media first

This year all journalists are restricted to the press centre, the first time that the media have not been in the same room as the premier at his annual press conference.

All journalists attending the conference were tested for the coronavirus at 6am today and had to wait for the results at the Diaoyutai Hotel.

The premier is expected to answer questions on the economy, Hong Kong, US-China ties and Taiwan.