Jiabao said on Wednesday macro control measures should be further strengthened
to prevent the fast-growing national economy from overheating.
The monetary policies should be stable in general but "moderately tightened"
to secure a stable and fast-growing economy, said Premier Wen at a meeting of
the State Council.
Wen said the country will continue to implement its current prudent fiscal
and monetary policies.
He called for fiscal policies to be more supportive of industrial
said industrial production is growing at a rate that is faster than desired and
the trade surplus is too big.
China's trade surplus in May soared to US$22.45 billion, up 73 percent from
the same month last year.
Wen said the country would continue to adjust export rebates and tariffs on certain items while further improving policies to
boost imports in a bid to address the climbing trade surplus.
Sustained fast growth of investment, excessive liquidity in the capital
market and rising inflation pressure also deserve more attention, said Wen.
Wen said the government would control the supply of land and bank loans to
high energy-consuming projects.
He also said financial, fiscal and taxation measures should be employed to
guide the flow of capital. He said there should be more channels for capital
outflow and for the use of foreign exchange.
Rising food prices have caused the consumer price index (CPI) to rise 3.4 percent in May, higher than the government's
target of three percent.
Wen pledged to stabilize food prices by ensuring the food supply and enhanced
supervision over food quality.