US Economic Recession To Hurt China
The following group of articles from Xinhua are about the impact of the US economic crisis on China.
From Xinhua, via China Daily:
American economists are forecasting that U.S economy, which contracted 0.3 percent in the third quarter, will shrink by more than 2.5 percent in the October-December period.
The belt-tightening of American consumers, who lowered their spending in the last few months, unnerved by a worsening financial meltdown and a gloomier economic outlook, is to have very negative repercussions for the Chinese economy, which has been relying on export shipments to the United States, Europe and elsewhere to gain momentum.
From Xinhua, via People’s Daily:
As recession is hitting, global wealth measured as household financial assets is expected to shrink 14 percent from last year’s 109 trillion U.S. dollars to 97 trillion U.S. dollars this year, reversing a six-year-long upward trend.
Emerging markets and China in particular are likely to represent the strongest potential for continued growth in wealth, according to the latest Global Wealth Report 2008 of the Boston Consulting Group (BCG).
North America — epicenter of the financial crisis — and Europe would remain the wealthiest regions but the size of their aggregate wealth, about two-thirds of the world’s total in 2007, was expected to continue dipping in the next five years.
China’s decision to cut interest rates on Thursday is part of its flexible monetary policy to cope with the world financial crisis and boost domestic economy, a central bank spokesman said on Friday.
Li Chao, spokesman of the People’s Bank of China (PBOC) explained the government’s cut in interest rates for the second time in one month.
On Wednesday, the PBOC announced to cut interest rates by 0.27 percentage points as of Oct. 30 to spur economic growth. The benchmark one-year deposit rate dropped to 3.60 percent from 3.87percent, while the benchmark one-year lending rate fall from 6.93 percent to 6.66 percent.
And also from Xinhua : Hu: Domestic spending key to stability:
Chinese President Hu Jintao has called for creating more domestic needs to keep stability of the country’s financial market and economic growth.
Hu, also general secretary of the Communist Party of China (CPC) Central Committee, made the remark during his visit to Yulin city in northwest China’s Shaanxi Province from October 28 to 29.