Premier Wen receives interview with Xinhua, discussing economic tasks

In an exclusive interview to Xinhua News Agency, Premier Wen Jiabao has addressed the concerns of ordinary people about soaring house prices. He also discussed immediate and near-term concerns about the economy, warning against a premature pull-out from fiscal stimulus.

In an exclusive interview to Xinhua News Agency, Premier Wen Jiabao has  addressed the concerns of ordinary people about soaring house prices.

Premier Wen Jiabao said that thanks to the efforts made by all the people, China has stabilized its economic growth and employment, and maintained social stability. He said the central government's economic stimulus package has proved effective, but that an early exit could imperil recovery.

Wen Jiabao, Chinese Premier said "As the premier of the government, I have the obligation to deliver the true situation to the people, and to bring confidence and hope to them."

Premier Wen Jiabao said the problem of overcapacity in China is unrelated to the central government's stimulus package. He guaranteed that the 1.18-trillion-yuan investment the central government planned for 2009-2010 has not been and will not be spent on any industrial projects. He said that some excess capacity will be channeled into new fields through technological innovation.

Premier Wen said he has noticed complaints on the Internet, sometimes even harsh criticisms, about housing prices. He said that the government will crack down on illegal activities, including hoarding of land, driving up housing prices and delaying sales for bigger profits. He added that the government will use tools such as differentiated interest rates to curb speculation.

Premier Wen warned that although there is no sign of inflation at present, this year's exceptional money supply growth could stoke inflationary expectations and inflation could appear.