China 'to focus on reviving growth'

Chinese Premier Wen Jiabao said Tuesday that stabilising growth was a "top priority", after fresh data raised more worries of a slowdown in the world's second-largest economy.

"As a big developing country, a certain speed of economic growth must be maintained," Wen said. "Stabilising economic growth is not only a top priority, but also a long-term arduous task."

His comments came shortly after the government reported that demand for imports fell more sharply than expected in June, leading to a widening of the trade surplus and stoking concerns about an economic slowdown.

A day earlier China said inflation slowed in June to its lowest level in 29 months, giving the government more flexibility in its efforts to reboot the economy.

Wen said encouraging domestic consumption, diversifying exports and boosting government investment would provide drivers for growth.

"Currently, it is important to promote reasonable growth in investment," he said in a statement.

His remarks came just three days before China is due to announce economic growth figures for the second quarter.

China's economy grew an annual 8.1 percent in the first quarter of 2012 -- its slowest pace in nearly three years.

Economists expect the economy to have grown 7.6 percent in the second quarter from a year earlier, according to a poll by Dow Jones Newswires.

China early this year set an annual economic growth target of 7.5 percent, down from expansion of 9.2 percent last year and 10.4 percent in 2010.

Among the measures already taken to avert a hard landing, the government last week cut interest rates for the second time in a month.

The government has also cut reserve requirements -- the amount of money banks must hold in reserve -- three times since December last year.

Top leaders have urged a move away from exports and the promotion of domestic consumption as the key engine of economic growth.

The nation's trade surplus hit $31.73 billion in June, up 42.9 percent from the same month last year, the General Administration of Customs said on Tuesday.

While exports for the month rose 11.3 percent year-on-year to $180.21 billion, imports climbed just 6.3 percent to reach $148.48 billion, according to the government's data.

"While exports increased at a low level, growth of imports was sharply slower than exports as domestic demand declined due to China's slowing economy," customs spokesman Zheng Yuesheng told reporters.

Compared with May, exports in June declined 0.5 percent and imports were down 8.9 percent.

"The data overall suggest that domestic investment and global growth are slowing," Alaistair Chan, an economist with Moody's Analytics, said in a research report.

Slowing domestic growth would prompt China to further ease monetary policy while at the same time boosting investment, analysts said.

Wen's remarks on Tuesday came after he warned at the weekend that the country's economy faced "downward pressure" and called for more aggressive moves to keep growth on track.

"China will definitely continue to introduce monetary easing policies," said Citic Bank International's chief economist, Liao Qun.

"There may be one interest rate cut and two cuts in the banks' reserve requirement ratio in the second half."

Loading...

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • SE Asia Stocks - Philippines at four-month low after Q1 GDP miss

    BANGKOK, May 28 (Reuters) - Philippine shares hit a more than four-month low on Thursday after economic growth in the first quarter was slower than expected, while Thai stocks retreated after disappointing ... …

  • Philippine economic growth slows to 5.2 percent in 1Q

    MANILA, Philippines (AP) — Sluggish government spending slowed Philippine economic growth in the first quarter of this year, officials said Thursday. …

  • PSE to sell Makati and Ortigas offices
    PSE to sell Makati and Ortigas offices

    Set to move to a unified headquarters in Bonifacio Global City in 2016, the Philippine Stock Exchange (PSE) has issued plans to sell their offices in Makati and Ortigas. PSE President Hans Sicat issued that PSE means to sell the offices, but that they may also opt to rent them out instead. …

  • ‘Inland areas could be exposed to tsunami-like waves’
    ‘Inland areas could be exposed to tsunami-like waves’

    While strong earthquakes cause tsunamis in coastal areas, the Philippine Institute of Volcanology and Seismology (Phivolcs) warned that inland areas could also be exposed to tsunami-like waves, or seiche, if located near or around bodies of water. In a recent earthquake awareness seminar in Muntinlupa, Phivolcs supervising science research specialist Joan Salcedo explained that a seiche is a large wave similar to a tsunami, triggered by strong ground shaking from an earthquake or volcanic …

  • China gives ‘gentle reminder’ to Phl, warns small nations
    China gives ‘gentle reminder’ to Phl, warns small nations

    China gave the Philippines a “gentle reminder” last Tuesday that Beijing will not bully small countries but warned these nations not to make trouble willfully and endlessly. “Here is a gentle reminder to the Philippines: China will not bully small countries, meanwhile, small countries shall not make trouble willfully and endlessly. The Chinese Foreign Ministry also said that China would continue to build other civilian facilities on relevant maritime features in the disputed Spratly Islands …

  • Back-channel diplomacy pushed for Phl-China dispute
    Back-channel diplomacy pushed for Phl-China dispute

    The Philippines should consider backchannel diplomacy to prevent its territorial dispute with China from deteriorating further, Sen. Ferdinand Marcos Jr. said yesterday. There are a lot of Filipino businessmen with businesses in China and they have friends and connections there. Let’s utilize that, ask them to talk to their friends on how we can resolve this matter peacefully,” Marcos said. …

  • Phl, Japan to deepen ties amid China sea claims
    Phl, Japan to deepen ties amid China sea claims

    Japan and the Philippines are set to bolster security ties when President Benigno Aquino visits Tokyo next week, the latest move by Prime Minister Shinzo Abe to beef up cooperation with Southeast Asian nations facing China’s growing naval ambitions. The two sides will likely agree to start talks on a framework for the transfer of defense equipment and technology and to discuss a possible pact on the status of Japanese military personnel visiting the Philippines to facilitate joint training and …

  • Phl, Vietnam troops play soccer on disputed isle
    Phl, Vietnam troops play soccer on disputed isle

    Vietnamese and Philippine troops played soccer and sang karaoke on a South China Sea island yesterday in a sign of the growing security ties between the two Southeast Asian nations most at odds with Beijing over the contested waterway. Cooperation has blossomed between Hanoi and Manila since they shelved decades of enmity over their competing claims in the Spratly archipelago to try to counter China, whose creation of artificial islands in the region will allow it to project power deep into …

POLL

Should Aquino be held accountable over the Mamasapano operations?

Loading...
Poll Choice Options