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Hopeful Wen pushes stimulus
Source: Agencies |
February 3, 2009, Tuesday
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Print Edition
Print Edition
PREMIER Wen Jiabao said yesterday that there is "light at the end of the tunnel" but he called for strong and effective stimulus plans to boost economies hit by the global financial crisis.
"In some places people are disappointed, people are frustrated and people are pessimistic. They are unsettled by the current situation," Wen told a business conference in London.
"There is light at the end of the tunnel ... I am calling for confidence, cooperation and responsibility, I've been calling for that all along because if we do that we can save the world."
The conference was also attended by British Prime Minister Gordon Brown, who is preparing to host a summit of world leaders in London in April at which new measures to tackle the global credit crisis will be developed.
China's economic growth slowed to an annual rate of 6.8 percent in the last quarter of 2008, dragging down the pace for the year as a whole to 9 percent - the lowest in seven years.
The Chinese government earlier pledged 4 trillion yuan (US$585 billion) over the next two years to help boost domestic demand.
Work is under way on projects including rebuilding earthquake-hit areas in southwest China and improving road and rail links.
Wen told the Financial Times that even more might be needed. "We may take further new, timely and decisive measures. All these measures have to be taken preemptively before an economic retreat," he said in an interview published on Sunday.
On other issues, Wen rejected allegations that China is manipulating its currency exchange rate, and he vowed to keep the yuan at a reasonable and balanced level.
"To allege that China is manipulating its currency exchange rate is completely unfounded," Wen said.
Maintaining the stability of the yuan will benefit both China and the world economy, the premier said.
Asked if China's US$2 trillion in reserves is partly to blame for the financial crisis, Wen said such a view is "ridiculous."
"I think the reason for this financial crisis is the imbalance of some economies themselves. They have for a long time had double deficits, and they continue a high level of consumption on the basis of mass borrowing," he said.
Wen said China needs a large pool of financial resources to achieve economic development and improve its citizens' livelihoods.
"I think that it is confusing right and wrong when people who have been overspending blame those who lent them the money," the premier said.
Wen also criticized the Western banking model.
"Some financial institutions pursued profit in a blind way without effective regulation," he said.
"They have been using excessive leverage to gain huge profit, but when the bubble burst the world was exposed to disaster."
"In some places people are disappointed, people are frustrated and people are pessimistic. They are unsettled by the current situation," Wen told a business conference in London.
"There is light at the end of the tunnel ... I am calling for confidence, cooperation and responsibility, I've been calling for that all along because if we do that we can save the world."
The conference was also attended by British Prime Minister Gordon Brown, who is preparing to host a summit of world leaders in London in April at which new measures to tackle the global credit crisis will be developed.
China's economic growth slowed to an annual rate of 6.8 percent in the last quarter of 2008, dragging down the pace for the year as a whole to 9 percent - the lowest in seven years.
The Chinese government earlier pledged 4 trillion yuan (US$585 billion) over the next two years to help boost domestic demand.
Work is under way on projects including rebuilding earthquake-hit areas in southwest China and improving road and rail links.
Wen told the Financial Times that even more might be needed. "We may take further new, timely and decisive measures. All these measures have to be taken preemptively before an economic retreat," he said in an interview published on Sunday.
On other issues, Wen rejected allegations that China is manipulating its currency exchange rate, and he vowed to keep the yuan at a reasonable and balanced level.
"To allege that China is manipulating its currency exchange rate is completely unfounded," Wen said.
Maintaining the stability of the yuan will benefit both China and the world economy, the premier said.
Asked if China's US$2 trillion in reserves is partly to blame for the financial crisis, Wen said such a view is "ridiculous."
"I think the reason for this financial crisis is the imbalance of some economies themselves. They have for a long time had double deficits, and they continue a high level of consumption on the basis of mass borrowing," he said.
Wen said China needs a large pool of financial resources to achieve economic development and improve its citizens' livelihoods.
"I think that it is confusing right and wrong when people who have been overspending blame those who lent them the money," the premier said.
Wen also criticized the Western banking model.
"Some financial institutions pursued profit in a blind way without effective regulation," he said.
"They have been using excessive leverage to gain huge profit, but when the bubble burst the world was exposed to disaster."
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