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China targets early recovery with stimulus, consumer spending

(Xinhua)
Updated: 2009-02-03 17:15

Regional impact varies widely

Another significant factor, Yuan said, was that many inland and northern regions were less affected by the financial crisis and its impact on exports.

In comparison with more export-oriented provinces such as Guangdong and Zhejiang, where many factories cut back or shut down, inland and northern Chinese regions had been less affected. "Regions or companies with more connection with domestic demand suffered less impact," he said.

NBS' Ma said he was confident of the economy's prospects partly because robust demand in less-developed central and western regions would continue to propel national growth.

These less-affected regions were seeing more development opportunities in the past two months as the central government acted to stimulate the economy.

Party chief Zhao Shihong of Langfang in north China's Hebei Province did not think the financial crisis had exerted a significant impact on the city, which is located between Beijing and Tianjin. Instead, he said he expected the response to the crisis would mean opportunities for the city.

Langfang won big projects valued at more than 10 billion yuan from the country's stimulus plan, including construction of two light rail lines. "It would have been very difficult to win [such] investment in the past," he told Xinhua.

Zhao forecast the city's economy would grow up to 12 percent this year despite the financial crisis.

Early recovery despite difficulties

Premier Wen Jiabao, in a tour of eastern China's industrial Jiangsu Province last month, gave his assessment of the situation.

"Measures taken by the central government to expand domestic demand and maintain growth have begun to take effect in some regions. Sales at some companies started to rebound, stockpiles decreased and electricity consumption increased. Some economic indicators were showing signs of recovery," he said.

Wen has acknowledged that this year would be the most difficult so far in the new millennium for the economy, but he also said China was likely to enjoy the earliest recovery among the world's major economies and achieve 8 percent growth this year.

More recently, in an interview with the Financial Times published over the weekend, Wen said China might take other "new, timely and decisive" stimulus measures.

According to Tang Min, China was likely to announce more measures, including industry-specific support plans, to support growth and the economy was expected to rebound in the second or third quarter.

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