Senior financial official backs economy

A senior Chinese financial official has backed the country's economy to recover from its slowdown while visiting Zhejiang, the eastern province known for its pioneering trade success.

The economy is transitioning from old to new models of growth with structural adjustment that should be analyzed from a long-term perspective, said Liu He, head of the country's Central Financial Work Leading Group Office, on a tour of Zhejiang on Sept. 6 and 7.

According to a report in the Zhejiang Daily on Wednesday, Liu pointed to China's swelling middle classes and consumption potential as reasons for optimism.

China's foreign trade in August dropped 9.7 percent year on year to 2.04 trillion yuan (320.8 billion U.S. dollars), a steeper decline than the 8.8-percent contraction in July, official data showed on Tuesday.

Last year's GDP, revised down to 7.3 percent on Monday, marked the weakest annual expansion for China in 24 years, and growth further slowed to 7 percent in the first half of 2015.

Innovation and reform remain key to tackling the problems, and there should be an overhaul of state-owned enterprises, the financial sector and taxation, Liu said.

He visited two towns included in a provincial government strategy of designating business fields that the towns are suited to and in which local industries should specialize. They include technology, exports of green tea and silk, tourism, healthcare and fashion.

The strategy is an innovative one that satisfies market demand and properly handles relations between the government and the market, allowing for the entrepreneurship that policymakers believe is crucial to China's economic upgrade, according to Liu. Endi