A report from Bloomberg says that China’s Premier Wen Jiabao has declared that his nation “cannot and will not” exit from its stimulus policies.
Bloomberg says that Wen made the announcement in his keynote speech at the World Economic Forum in Dalian, a city in northeastern China. Wen says the government will continue with a moderately loose monetary policy and a “proactive” fiscal policy and stresses that the nation is taking all possible steps to expand employment. The premier adds that domestic demand is playing a bigger role in China's economy.
According to Bloomberg, the Chinese economy is rebounding from its slowest expansion in almost a decade on record lending in the first half and a 4 trillion yuan ($586 billion) stimulus package.
While falling exports, overcapacity in manufacturing and elevated unemployment have restrained the recovery, Bloomberg says that China's economy accelerated in the second quarter, expanding 7.9%. A resurgence of the property market, rising auto sales and the fastest expansion of manufacturing in 16 months in August have added to signs that the recovery is maintaining momentum.
According to a Bloomberg survey of 22 economists conducted the week ending August 28, China’s gross domestic product may increase 9.5% in 2010 after an 8.3% gain in 2009, the smallest in eight years.