December 24, 2008

Beijing: More Stimulus Coming

The Standing Committee of the National People's Congress heard today a report from Zhang Ping head of the National Development and Reform Commission. Minister Zhang informed China's legislature that the economic condition of the nation continues to deteriorate and the slowdown has spread from coastal regions to the interior. Exports and investment growth - the biggest levers of the Chinese economy - have slowed rapidly, Zhang confirmed. Business profits and government receipts are dropping.
The report advises China's government that the situation is unprecedented and the outcome not clear. Beijing will respond with an additional stimulus of 120 billion Yuan at the end of the 4th Quarter, a figure that should be matched by governments on the local (county or municipality) level. Much of the stimulus will be used on infrastructure projects and housing for the poor.


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