Chinese economy is showing signs of positive change from the ongoing global economic downturn, premier Wen Jiabao said in Thailand on April 11 on the sidelines of the ASEAN Summit which has been cancelled due to security concerns.
Wen said that China had initiated an unprecedented 4-trillion-yuan stimulus package to battle the global economic recession late last year. Thanks to the huge stimulus package, the economy showed better-than-expected signs of improvement in the first quarter this year.
Domestic demand has been steadily on the rise and investment on fixed assets and consumption demand grew rapidly. Industries above the designated level have witnessed robust growth. The purchasing manager’s index and entrepreneur confidence index grew steadily, which showed China's economy beginning to rebound in some sectors. The huge package also boosted market confidence and economic vitality. Transactions in stock markets and real estate sectors have expanded.
Although the economy shows positive signs, it still faces very grim difficulties. Manufacturing accounts for a large portion of China's economy and has been greatly affected by the falling demand in recession-hit western countries. "As the crisis has not touched its bottom, we can hardly say that China's economy alone has got out of the recession. We will try our best to bring the impact of the crisis to a minimum," said Wen.
Wen said that China should spare no time in implementing various measures included in the stimulus package. The following steps require early attention: stimulus investment should be allocated timely; specific regulations on the readjustment and revitalization of ten major industries should be issued; construction of a social security network should be enhanced.
Wen also made remarks on the pilot scheme of allowing the use of RMB to settle cross-border trade payments. Five costal cities, namely Shanghai, Guangzhou, Shenzhen, Dongguan, Zhuhai have got the nod from central government to use yuan in overseas trade settlement. According to the scheme, the five cities will carry out RMB settlement in trade with Hong Kong and Macau SARs and ASEAN countries. All the normative documents guiding the scheme will be carried out immediately. RMB trade settlement will boost trade development in Hong Kong, and strengthen HK's role as an international financial centre.
Wen further noted that central government has been attaching great importance to the development of the financial industry in Hong Kong. The response from HK media over central government's decision to build Shanghai into an international finance centre is mixed. As a matter of fact, the status of being an international financial centre is decided by market competition rather than by government. HK enjoys the geographical advantage and the history of being a financial hub. The top priority now is to step up supervision and promote steady and healthy growth. Meanwhile, HK also needs to search for new areas of economic growth, for instance, trade and logistics, tourism, medical care, sci-tech, high tech, laying foundations for further economic development.
As of the economic development in Macau, premier Wen noted that the economy in Macau largely depends on casinos. Central government now is working on a long-term development plan for Pearl River Delta Region, which, after completion, will definitely enhance economic cooperation between Macau and neighboring Guangdong province and lend concrete support to the region's growth.
By People's Daily Online
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