China premier says economy faces growing downward pressure

BEIJING (Reuters) - China's economy faces increased downward pressure, the premier has said, as the country prepares to announce first-quarter economic growth.

The government must "stand up to the downward pressure," Premier Li Keqiang said late on Friday, to avoid an impact on employment and incomes, according to a statement on the government's website.

"At this time, the national economy is running smoothly, but downward pressure continues to grow," Li said.

Li also called for speeding up reforms in the northeast, a centre of mining and heavy industry that has been lagging in growth.

The central government will funnel more support to the region for infrastructure, agriculture and equipment export, he said.

Known as China's rust belt, the northeast was plagued by widespread layoffs in the 1990s, when the government forced state factories to shut en masse to cull inefficient industry.

Li called for the timely launch of major infrastructure projects in the region in areas such as transport and water conservation with the support of financial institutions.

The region enjoyed an economic boom in the past decade due to support from the central government and growing demand for raw materials and machinery products, but the revival has faltered this year as China's growth grinds toward a 24-year low.

In a separate statement on the government's website on Saturday, Li said economic development had entered a "new normal". He also called for more targeted measures to support the economy.

In a third statement, Li called for the speeding up of railway construction, calling railways "the main artery of the national economy".

China has said it plans to pour more than 800 billion yuan($129 billion) into building railways in 2015. Investment in railways are part of the government's push to spur growth.

($1 = 6.2080 Chinese yuan renminbi)

(Reporting By Megha Rajagopalan; Editing by Robert Birsel and Rosalind Russell)