According to news released on April 16 by Xinhua News Agency, Premier Wen Jiabao spoke to a State Council executive meeting on April 15, noting that the package plan for expanding domestic demand has achieved initial success, and the situation is better than expected. But he also acknowledged that the foundation of China's economic rebound is not solid, and that internal and external environment is also very serious.
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This announcement came after the release of the news of 6.1% GDP growth for the first quarter, and the day after the meeting. The contents of a State Council executive meeting are usually announced on the same day of the meeting. A delayed release is often because of the particularly important matters discussed. For example, the four trillion yuan economic stimulus package was not announced until four days after a meeting.
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Eight new stimulus plans were introduced at the meeting, including immediate issue of the third central investment, expansion of corporate bond issuance, measures to encourage private investment, and the acceleration of the process to the launch of a Nastaq-styled Growth Enterprise Board.
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Threats to China's economic recovery are various: continuing shrinkage of external demand and export decrease, industrial overcapacity, weak pick-up in industrial growth, declining economic efficiency, reluctance of private investment, increased difficulties in stable agricultural development and upping farmers�incomes, government fiscal income decline, and large unemployment pressure.
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The government has made it clear that policies on the stability and expansion of foreign capital use should be made. Foreign trade development funds and credit should be made the best use of and more support given to exports of high-tech and labor-intensive products.
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Much of the discussion focused on the implementation of the existing measures. China's large bureaucratic structure means there is a lot of room for delay in the system as measures to stimulate the economy get lost in the cracks. This is one of Wen’s primary concerns.
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The Premier is scheduled to state his views on China’s economy at the Boao Forum for Asia on April 18 on Hainan Island. The speech will be Wen's first public speech since China's first-quarter GDP growth was released. It has been reported that Wen arrived in Hainan yesterday and convened a meeting to listen to the views of some enterprise managers.
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Major ministries and officials will participate in the forum, including Zhou Xiaochuan, governor of the central bank, and Liu Mingkang, Chairman of China Banking Regulatory Commission, among others. It is said that the meeting agenda will deal mainly with how to help China's economy recover faster.
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