China Targets Early Recovery with Stimulus, Consumer Spending

REMAKING GUANGDONG

As for Guangdong, whose GDP grew 10.1 percent in 2008, the provincial government aims to spur economic growth with more reliance on fixed-asset investment as exports decline.

Xie Pengfei, a senior provincial official, said Guangdong had arranged 200 major construction projects this year, with a combined investment of 303 billion yuan, more than double that for2008. Some of these projects were previously planned as infrastructure for the 2010 Asian Games.

Guangdong is also at the center of a national plan to upgrade the industrial structure of the Pearl River Delta. In a plan announced last month, the central government said it would develop two or three cities into service outsourcing centers by 2012.

It also planned to develop two or three large vehicle makers in the province by 2020 and develop petrochemical refining and advanced power transmission and distribution manufacturing bases.

With increased investment, Guangdong's economy was likely to grow by about 9 percent this year as long as consumption continued to increase stably and exports didn't decline, he said.

NASCENT SIGNS OF REVIVAL

Since Nov. 9, when the cabinet unveiled the stimulus package, and Jan. 23, when the market closed for Lunar New Year, the key Shanghai stock index rose more than 14 percent. It rose another 1 percent on Feb. 2, when it re-opened after the holiday, as investors reacted to a statement by Wen.

He told the Davos international financial forum over the weekend that loans of Chinese banks hit 900 billion yuan in the first 20 days of January, up 12 percent year-on-year.

Another sign of emerging recovery might be found in Shandong Province, which has the country's major minerals trading port, Rizhao. That port handles iron ore and the like. Throughput rose 2.7 percent year-on-year in January, indicating reviving demand for raw materials.

Source: Xinhua