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China prepared for more stimulus measures
By Winny Wang |
March 13, 2009, Friday
|
Online Edition
Online Edition
CHINA is prepared to add new measures to its 4-trillion-yuan stimulus package to fight the fallout from the economic downturn, Premier Wen Jiabao said today.
"We have prepared contingency plans against the financial crisis and 'adequate ammunition' to face more difficult times, and we are ready to introduce new measures to stimulate economy at any time," Wen said at a press briefing in Beijing after the annual session of parliament.
Gong Fangxiong, an analyst with JP Morgan, suggested the country launch a second stimulus package worth between 1 trillion yuan and 2 trillion yuan.
"China's declining exports have yet to bottom out, and the 4-trillion-yuan package is not enough to secure an 8-percent economic growth this year," Gong said.
The second package could focus on spurring consumption, by reducing personal income tax and issuing coupons, rather than fixed-asset investments, he said.
China rolled out a 4-trillion-yuan two-year stimulus package in November to boost domestic demand and ease reliance on slumping exports, for which the central government will fund 1.18 trillion yuan.
Wen said the 1.18 trillion yuan will all be new spending and 595 billion yuan of this will be spent this year.
Wen also said that it is an arduous task for China to achieve the 8-percent economic growth target this year, but it is still possible with considerable effort.
China's economy cooled to a seven-year low of 9 percent last year and broke a five-year streak of double-digit expansion. In the last quarter, growth fell to 6.8 percent, the lowest in nine years.
"We have prepared contingency plans against the financial crisis and 'adequate ammunition' to face more difficult times, and we are ready to introduce new measures to stimulate economy at any time," Wen said at a press briefing in Beijing after the annual session of parliament.
Gong Fangxiong, an analyst with JP Morgan, suggested the country launch a second stimulus package worth between 1 trillion yuan and 2 trillion yuan.
"China's declining exports have yet to bottom out, and the 4-trillion-yuan package is not enough to secure an 8-percent economic growth this year," Gong said.
The second package could focus on spurring consumption, by reducing personal income tax and issuing coupons, rather than fixed-asset investments, he said.
China rolled out a 4-trillion-yuan two-year stimulus package in November to boost domestic demand and ease reliance on slumping exports, for which the central government will fund 1.18 trillion yuan.
Wen said the 1.18 trillion yuan will all be new spending and 595 billion yuan of this will be spent this year.
Wen also said that it is an arduous task for China to achieve the 8-percent economic growth target this year, but it is still possible with considerable effort.
China's economy cooled to a seven-year low of 9 percent last year and broke a five-year streak of double-digit expansion. In the last quarter, growth fell to 6.8 percent, the lowest in nine years.
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