Wen determined to meet downturn with stimulus
Wen determined to meet downturn with stimulus
Friday 13th March 2009
Chinese premier Wen Jiabao has said his government has the economic "ammunition" to follow up its stimulus package with further spending.Speaking at his annual press conference, Mr Wen explained the thinking behind the four trillion yuan (£0.4 trillion) two-year economic stimulus package.
"The most direct, powerful and effective way to deal with the current financial crisis is to increase fiscal spending – the quicker the better," he said.
"We have prepared enough ammunition and we can launch new economic stimulus policies at any time."
China hopes to avoid its annual economic growth slipping below eight per cent. Its ruling Communist party fears social unrest which could destabilise its power base if this occurs.
Mr Wen admitted he had "doubts" about China's heavy investment in US government debt, but backed Barack Obama's own stimulus package as the best method to bring about a recovery from the current global downturn.
Global markets have responded positively to the suggestion Beijing is prepared to spend its way out of current difficulties.
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