China’s economy recovering, says central bank chief

Washington, April 26 (Inditop) China’s central bank chief has said the country’s economy has done better than expected in the wake of the ongoing economic slowdown.

“Facing the impact of the financial crisis, the Chinese government has promptly introduced a policy package to expand domestic demand and maintain financial stability, striving to respond to the impact of the financial crisis,” Zhou Xiaochuan, Governor of the People’s Bank of China, said at the International Monetary and Financial Committee (IMFC) meeting held here Saturday.

“Positive changes have appeared in the operation of the national economy, and overall performance is better than expected,” Zhou said.

The slowdown in GDP growth has been contained, with GDP growth in the first quarter of 2009 reaching 6.1 percent, while the growth rate in industrial production has also rebounded, with industrial added value growing 5.1 percent over the same period last year, said Zhou, adding that “there are signs of gradual stabilization”.

China’s economic growth slowed to 6.1 percent in the first quarter, which several analysts said was the lowest in nearly two decades, from 6.8 percent in the fourth quarter of 2008.

Meanwhile, Zhou warned that the Chinese economy is still facing challenges. “It should be recognised that the rebound in China’s economy remains to be consolidated,” he said.

“The internal and external environments are still challenging, external demand continues to shrink, the decline in export volume is relatively large, some industries have excess capacity, government revenue is falling, and employment pressures continue,” he noted.

The Chinese government will continue its implementation of an aggressive fiscal policy and a moderately accommodative monetary policy, and implement the package plan in response to the crisis, said Zhou.

He stressed that the long-term economic development trend in China has not changed.

“As macroeconomic policies gradually take effect, China’s economy has the conditions for maintaining relatively rapid development,” he said.