According to China's Premier Li Keqiang, the country's economy is facing new downward pressures and must reduce taxes and fees to address the problems faced by small and medium-sized businesses.

Li did not specify the magnitude or cause of the new "downward pressure," but the phrase is commonly used by Chinese officials to refer to a slowing economy. He's said it before, including several times in 2019.

The economy requires "cross-cyclical adjustments" to stay on track, Li said during a visit to China's top market regulator, according to state broadcaster CCTV. This phrase is associated with a more conservative fiscal and monetary approach that prioritizes long-term economic prospects over short-term economic performance.

China's economy has been slowing in recent months as a result of Beijing's push to slow real-estate growth. Li's comments came after more signs of weakness in October, owing to power shortages that weighed on manufacturing and strict coronavirus controls that slowed holiday spending.

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“There are no obvious growth drivers now, so the government is looking for one,” said Bruce Pang, head of macro and strategy research at China Renaissance Securities Hong Kong Ltd. “Small businesses’ investment can provide a source of healthier, longer-term growth, compared with government or property investment.”

Pang stated that the government will encourage banks to lend more to small businesses, reduce taxes and fees for them, and simplify administrative procedures in order to encourage more entrepreneurs.

The official manufacturing purchasing managers' index fell to 49.2 last month, according to the National Bureau of Statistics, the second month in a row that it fell below the key 50-point threshold that indicates a drop in output.

In recent weeks, several investment banks have reduced their forecasts for China's 2021 growth to less than 8%. However, Former Chinese central bank adviser Huang Yiping,  said that while China's economy will slow further in the coming months, annual growth of around 8% is still achievable.