The government is ready to introduce a series of measures to cushion the impact of slower growth in foreign trade and industrial output caused by the global credit crisis, the vice-minister of the National Development and Reform Commission, said Thursday.
Speaking at a press conference held by the State Council Information Office in Beijing, Du Ying said that as the global economy has slowed, foreign trade volume, value-added output and the profit growth of industrial firms based in China's coastal areas have shown a downward trend in the second half of the year.
"The State Council is greatly concerned by the trend and is ready to introduce a series of measures," he said.
But the full impact of the global financial crisis has yet to be seen, he said.
"We must have a full picture of the difficulties and challenges," he said.
The government has already taken several measures to combat the impact, including lowering the deposit reserve ratio, helping small- and medium-sized factories to upgrade their technologies, and introducing more favorable credit policies, Du said.
He said he is confident China can weather the storm.
"As in the past, China can overcome the challenges and difficulties and enter a new stage of development. I'm fully confident of that," Du said.
With the global financial crisis continuing to escalate, China - the world's fourth largest economy - has seen its major economic indexes slide.
The National Bureau of Statistics is due to release figures on Monday for the economic situation over the past three quarters.
Some analysts have forecast that GDP growth might drop further in the third quarter, from 10.1 percent in the second quarter and 11.9 percent for the whole of last year.
Yang Xiong, vice-mayor of Shanghai, said the city's industrial output growth fell to 6 percent last month from an average of 11.5 percent per month in the first three quarters.
The financial hub remains in good shape, however, partly due to investments in preparation for the 2010 World Expo, he said.
Zhao Kezhi, deputy governor of Jiangsu, said the province's trade figures were down 4 percent year-on-year in the first nine months.
Chen Min'er, vice-governor of Zhejiang, said the province had witnessed "individual" cases of company failures, but denied media reports of widespread factory closures.
Authorities will respond by trying to cut the tax burden on local firms, make more credit available and ensure a sufficient supply of land and power for manufacturers, Chen said, adding that now was a good time to weed out obsolete, polluting plants.
On Wednesday, Zhou Xiaochuan, governor of the central bank, called for increased domestic consumption to counter the economic slowdown.
"Due to the impact of various factors, we may need to increase domestic demand," he told Hong Kong-based Phoenix TV.
(China Daily October 17, 2008)