Updated: 2016-03-11 08:08
By Andrew Moody(China Daily Europe)
He said he would set aside a fund of $15.2 billion (13.8 billion euros) to help the 1.8 million people expected to lose their jobs over the next five years as the government deals with the so-called zombie enterprises that remain a drag on the overall economy.
Commodities markets, in particular, responded well to Li's speech, which could provide a boost to many African countries as well as Russia and Saudi Arabia.
On March 7, the price of iron ore, a key ingredient of steel, was bolstered by Li's promise to support the China housing market, and rose by 17 percent, its biggest ever one-day rise.
On the same day, oil prices gained 5.6 percent and rose above the psychological $40 a barrel mark at $41.04 a barrel, the highest level since the end of last year.
Louis Kuijs, head of Asia Economics at Oxford Economics, says the market reaction showed how much focus there was now on China's growth.
"Within China the equity prices of property companies have also gone up very sharply, so clearly the market is witnessing and is pricing in that strong commitment to growth by the government," he says.
"I don't really doubt that we will see robust infrastructure spending and we will also see other aspects of China's policymaking adding to growth."
Paul Kavanagh, Ireland's ambassador to China, says the premier's speech went a long way to reversing bearish expectations about the Chinese economy when the Shanghai Composite Index of shares plummeted in January.
"I think some of the international coverage is a little bit negative on the Chinese economy," he says.
"I agree with the premier that it has challenges, but it also has fundamental strength."
Pascal Gasunzu, Burundi's ambassador to China, believes the policy outline in the speech also could be good for Africa.
"I can see many opportunities in Premier's Li's report, as more Chinese investment is expected to come to Africa."
Some believe the emphasis on fiscal policy with the government set to run a 2.18 trillion yuan (305 billion euros, $335 billion) deficit might open up the debate as to whether deficit financing could be the solution to global slowing growth. The Organization for Economic Cooperation and Development forecasts world growth to fall from 3.3 to 3 percent this year.
The recent G20 meeting of central bankers and finance ministers in Shanghai avoided this emphasis, advocating a mix of fiscal and monetary stimulus as well as restructuring.
There will now be much anticipation ahead of the summit under China's presidency, which takes place in Hangzhou in September.
"I think it is possible it could lead to renewed focus on fiscal policy globally. The problem though is that space to do this is more limited ... than in China," adds Kuijs at Oxford Economics.
"In many European countries the fiscal arithmetic is not very pleasant, with high debt and slow growth, so there is not a lot of space to do it. Germany, one country that perhaps could use fiscal stimulus, has no appetite for it and says it is not going to do it."
George Magnus, an associate of the Oxford University China Centre, says China will probably be an outlier on fiscal policy for the time being.
"The Chinese proposal certainly stands in contrast to the themed fiscal restraint across the Western world," he says.