Friday, September 19, 2008

NDRC official: toughest ever challenges facing China

Cao Wenlian, vice director of Fiscal and Financial Department at the National Development and Reform Commission , was cited as saying at a financial forum held on Sep.18, 'China's economy is confronting the toughest ever test since the 1998 Asian financial crisis.' To combat the likely economic setbacks, he said, china will have to further promote the international revenue- expenditure balance, actively enhance import while streamlining export structures, upgrade the levels of using foreign investment, steadily push forward the strategies of 'going global,' and increase the strength of foreign equity investment in due form.

The financial forum—Changes and Strategies—was summoned in a time when the specter of worrisome Wall Street meltdown is hovering over the entire world, and the worsening U.S. sub-prime loan crisis is further threatening the emerging economies. Mr. Cao pointed that, in the current circumstances, we need to keep prudent and cautious when enhancing the foreign equity investment and fully aware of the potential risks.

In view of the increased consumer contributions to the economic growth in the first half of the year, Mr. Cao suggested that we should firmly adhere to the route of expanding domestic demand, quicken the pace to carry out the fiscal and tax system reforms, stage and perfect the supportive policies ensuring the implementation of the fiscal and financial measures, enlarge consumption produced by the countryside and service industries, encourage the move of labor-intensive industries in the coastal areas to inland areas, increase the governmental input into the underdeveloped areas and strengthen the efforts in poverty elimination, and develop mini-and-medium financial institutions.

In addition, he deemed it a vital step to further highlight the predictability, flexibility and direction of the monetary policies, and make interests rate more market-oriented. Mr. Cao thought that China is undergoing the most severe challenges ever since the 1998 Asian financial crisis, but he insisted that the basic facets of China's economic development in the first half year are generally sound, and even better than anticipated; the economic development is gearing for the control goals.

Meanwhile, he thought it an evident tendency that the domestic demand is contributing more to China's economic growth, and therefore prices are basically under the effective control. It is predicted that China will not suffer an economic plummet in terms of the whole year's economic growth rate. 'I feel confident in China's post-Olympic economic situation,' he reassured people present at the forum.

By People's Daily Online

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