Chinese president Xi Jinping said the nation needs to adapt to a “new normal” in the pace of economic growth and remain “cool-minded” amid a slowdown in expansion.

China’s growth fundamentals haven’t changed and the country is still in a “significant period of strategic opportunity,” Mr Xi said, according to a Xinhua News Agency report on the central government website. At the same time, the government must prevent risks and take “timely countermeasures to reduce potential negative effects,” he said.

China's policy-makers are trying to keep economic expansion from slipping below premier Li Keqiang's 2014 target of about 7.5 per cent while reining in a credit boom that a central bank official said threatens to undermine the financial system. The government has so far limited its support to tax breaks, and speeding up infrastructure and social housing investment, with Mr Li saying last week the focus remains on the quality of growth and on changing the structure of the economy.

'Structural reforms'
"Authorities have increased their tolerance to somewhat lower growth as a necessary condition to push for structural reforms and contain financial risks," Banco Bilbao Vizcaya Argentaria SA economists, led by Hong Kong-based Alicia Garcia- Herrero, wrote in a report. "Risks are still tilted to the downside, concentrating on elevated financial fragilities and uncertainties about the implementation of their reform agenda."

The government will continue to balance the relationship between economic expansion, reform, restructuring, improving people’s well-being and preventing risks to ensure sound economic growth and social stability, Mr Xi said during an inspection tour to the central province of Henan from May 9-10, according to Xinhua. – (Bloomberg)