China Considering New Stimulus Measures; Stocks Gain http://www.bloomberg.com/apps/news?pid=20601087&sid=a17GDklr0BRQ&refer=home
Peace and best wishes. Xi On 3 mar, 21:36, xi <[email protected]> wrote: > My comments: Last weeks some gurus predicted negative or very low GDP > for China´s economy. I am not sure if this article is addressed to > foreigners address those predictions or is addressed to Chinese. > > If it addresses Chinese I have to tell that the question is not > whether China´s economy has or not such potential. Obviously it is. > Growth will be based on public demand (something that government can > handle) and reserves are high enough to fund such grwoth. On the > demand side, as planned, rural areas have room more than enough to > raise consumption because it is very low and savings are very high. As > tax incentive proved, retail sales can raise as much as required. > > In my opinion, the question is should we grow 8% or higher? In my > opinion we should not and, in my opinion, our government will change > its target along this year to something easier and natural, around 6% > to 7%. Basically because two reasons. > > I ponder the basic reasons, to absorve most migrant population. Of > course, I see the human face of unemployment, but to let economy to > slow down from 8% to 6% would not mean above 2% raise of unemployment, > from 4.4% to 6.4% more or less. Let us consider 6.5%, even. It is not > terrible if people are receiving something back (such as education). > > One reason because 6% would be better is exactly that. Recycling of > workforce toward more qualified activities will be more and more > important in years to come, at least until 2020. Focuss on that > educational structure along 2009 is more important that focuss on > employment for migrant workers. In the long run, those qualified > workers will pay higher contribution to their home villages. Better > than qualified workers who should migrate in from advanced provinces. > > I mean, it is better to use 2009 to educate workers from Yunnan than > to give them a work in 2009. Because in 2010 and later, they will > contribute with such expertise to Yunnan. If they are not qualified > enough, in 2010 Yunnan will require migrant workers from other > provinces that will not be so comfortable in Yunnan as people from > Yunnan will be. > > Another reason is that 8% means extra-effort that will be oriented > toward the short term. It is not the natural flow of our economy that, > by itself, is adjusting itself to 6% during this crisis. Many of those > extra-efforts will be waste of time and resources (funds, business > that will fail later, etc.) that will not be availbale in 2010, 2011, > etc. > > Peace and best wishes. > > Xi > > http://news.xinhuanet.com/english/2009-03/03/content_10935205.htm > > BEIJING, March 3 (Xinhua) -- China may attain its targeted 8 percent > economic growth, or even higher, this year, prominent Chinese > economist Li Yining told Xinhua Tuesday. > > The Chinese economy is also very likely to recover before other > major economies, even though the world economy is still shrouded in > uncertainty, said Li, a member of the 11th National Committee of the > Chinese People's Political Consultative Conference (CPPCC), the > nation's top political advisory body. > > "The economic slowdown is beginning to bottom out, and the economy > is bound to rebound on huge government investment," said Li. > > According to a survey of factories issued Monday by the brokerage > CLSA, China's manufacturing activity contracted for a seventh > consecutive month in February, but at a slower rate than previous > months. > > "The growth may not be very high, but won't stay around six > percent," Li said, "this year's growth could reach eight percent or > even higher." > > China's economic growth slowed to 6.8 percent in the fourth > quarter of 2008, dragging down the annual rate to a seven-year low of > 9 percent, as the unfolding global financial crisis takes a toll on > the national economy. > > Since last October, the government has announced several > aggressive measures to bolster domestic demand and increase > investment, including a 4 trillion yuan (585.5 billion U.S. dollars) > stimulus plan, a plan to expand rural consumption of home appliances > and support plans for key industries. > > Li, who has been a political advisor for more than 20 years, said > the attainment of a 8-percent growth would be decided by two factors: > a boost in domestic demand and changes in the global economy. > > The 8-percent growth was entirely within reach if domestic > investment and consumption could be spurred to support the growth, he > said. > > "However, the developments of the global economy is not up to our > country," he added. > > The economist who had proposed the ongoing shareholding system > reform in China also said the country should be able to see an early > recovery. > > "Our problems is not as complicated as in other countries," he > said, "and China's focus on expanding domestic demand could foster > future growth, although our exports may have to depend on overseas > demands." > > However, the country needed to enhance agricultural productivity > so as to increase farmers' income and to put both rural and urban > residents under the umbrella of the social security network before the > domestic demand could take off, Li said. > > "Farmers' contribution to the economy could be huge if their > income are raised to a higher level, given the large number of > farmers," he said. > > Of China's total 1.3 billion population, more than 900 million are > farmers. > > "Reforms of the pension system, education and medical insurance > should keep up with the economic growth to increase people's > willingness to spend," Li added. > > He said the public should have faith in the government's ability > to stimulate the economy. "There is no doubt about that." > > The 79-year-old economist said the fundamentals of the economy > remained unchanged, and difficulties of exporters are results of a > crisis originated outside the country. > > "The country needed to promote innovation, industrial upgrade and > economic restructuring in its efforts to bolstering the economy, and > these measures could not only ensure the economic growth, but also > improve the growth quality." he advised. > > The professor with the Peking University said employment should be > the country's top priority. The recovery of job creation is usually > behind that of economic growth, he warned. > > China said it aimed to create jobs for nine million people this > year. "It is not an easy target, but the country is actively finding > ways to make it happen," he said. > > About 20 million of China's migrant workers have returned home > after losing their jobs as the global financial crisis takes its toll > on the economy. > > Li also said the most important reform at the moment is the > integration of rural and urban areas in order to solve pressing issues > such as jobless migrant workers and rural development. --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups "World-thread" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/world-thread?hl=en -~----------~----~----~----~------~----~------~--~---
