State Council unveils new measures to mitigate coronavirus impact on economy

The State Council, China's cabinet, on Feb 25 unveiled a string of measures to facilitate the employment of college graduates and rural migrant workers, offer financial support to micro-, small- and medium-sized enterprises and solve the difficulties of self-employed persons to reduce the impact of the coronavirus epidemic on the economy.

The country will expand the enrollment of postgraduate and degree top-up programs, create more jobs of medical and social services at the community-level and strengthen support for micro and small enterprises to recruit more college graduates, according to a statement released after a State Council executive meeting chaired by Premier Li Keqiang.

Employment of rural migrant workers will be enhanced by creating more job opportunities at the laborers' hometowns or places nearby and approving a group of new projects providing a large number of posts. Key construction projects should prioritize poor laborers in recruitment.

The meeting decided to step up financial support to get micro-, small- and medium-sized enterprises back on track on a market-oriented and law-based principle.

Lenders are encouraged to roll over loans of cash-strained firms in Hubei province, the region hit the hardest by the epidemic, until June 30 and waive their default interest payments.

The country will also issue 500-billion-yuan (about $71.2 billion) reloan and rediscount quotas to give backing to small and medium-sized banks in their credit support for smaller enterprises while lowering the interest rates of reloans supporting agriculture and small firms by 0.25 percentage points to 2.5 percent.

Amid efforts to meaningfully lower the lending rates to the smaller firms, State-owned banks' balances of inclusive loans to small and micro businesses are tasked with a year-on-year growth target no less than 30 percent in the first half of this year and policy banks are urged to add special loan quota of 350 billion yuan for private and smaller businesses with preferential interest rates, the statement said.

The meeting also promised to help individual businesses to weather the epidemic impact as they are the major job providers, the statement said.

The meeting decided to exempt value-added tax for small-scale taxpayers in Hubei province and cut the tax from 3 percent to 1 percent for those outside Hubei from March 1 to May 31.

Individual businesses will also see a cut in their insurance contributions. Industrial and commercial companies not from high energy-consuming industries will enjoy a 5-percent cut in electrical charges.