Chinese Premier Li Keqiang signaled policy makers are reluctant to use stimulus to counter a slowdown in the world’s second-largest economy because the risks outweigh the benefits. “To achieve this year’s targets, the room to rely on stimulus policies or government direct investment is not big — we must rely on market mechanisms,” Li said in a May 13 speech broadcast to officials around the country, according to a transcript published last night on the central government’s website. Relying on government-led investment for growth “is not only difficult to sustain but also creates new problems and risks,” he said.

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The Arctic Council agreed on Wednesday to expand to include six new nations, including China, as observer states, as a changing climate opens the Arctic to increasing economic and political competition. The inclusion of observer states to the council came after a spirited debated at the council’s biennial meeting and reflected the growing prominence of the issues facing the region. The council includes the eight Arctic nations: Canada, Denmark, Finland, Iceland, Norway, Russia, Sweden and the United States.

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China’s environment ministry has given the go-ahead for the construction of what will become the country’s tallest hydroelectric dam despite acknowledging it will have an impact on plants and rare fish. The dam, with a height of 314 meters (1,030 feet), will serve the Shuangjiangkou hydropower project on the Dadu River in southwestern Sichuan province. To be built over 10 years by a subsidiary of state power firm Guodian Group, it is expected to cost 24.68 billion yuan ($4.02 billion) in investment.

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At the start of 2013, investment bank economists had high hopes that a rebound that appeared in the final quarter of last year would gather more steam. A survey of 18 economists by The Wall Street Journal late last year showed the median forecast for economic growth in 2013 at 8%, up from the 7.8% rise China’s economy posted last year. But now the numbers are telling a different story. A new survey of 12 economists this week showed that the median forecast has since fallen to 7.8%.

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Chinese Premier Li Keqiang on Monday called for less political power in the market economy in order to motivate creativity of market players and achieve transformation of the government. On a nationwide tele-conference about the functional transformation of the institutions of the State Council, or the cabinet, Li urged officials to properly handle relations between the government and the market as well as society, delegating unnecessary powers and managing businesses that the government is responsible for.

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