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Li, also a member of the Standing Committee of the Political Bureau of the Communist Party of China (CPC) Central Committee made the remarks at the cabinet's first meeting on clean governance.
More efforts should be taken to push forward pilot schemes for the innovative development of the service trade, and build a favorable investment environment to unleash market vitality, Hu said.
He urged local governments to deal with "stranglehold problems" concerning rural information infrastructure such as slow internet connections and poor funding, and increase investment in this regard.
The circular said that the gradual phasing out of profit-making services provided by the military had begun in 2016 and achieved significant progress, though there was still more work to be done.
The Chinese government puts great emphasis on financial services for the real economy, including for the small and micro businesses. Li called for giving greater priority to small and micro businesses in providing affordable finance to energize these businesses and boost employment.