The mainland will continue to be an important stabilising force in the world economy, Xinhua said in a commentary after a party summit concluded on Sunday. Economists said it might be a hint that Beijing would hold US Treasury bonds, instead of selling and taking losses or buying a substantial amount to help the bailout of US financial institutions. Official figures show the mainland had foreign reserves of US$1.8 trillion at the end of June, of which US$922 billion was invested in bonds issued by the US government and government-sponsored enterprises. It was the second largest owner of US debt after Japan. The Central Committee of the Communist Party, after the four-day meeting, said the mainland's economic situation was good, with 'relatively rapid growth maintained' and the 'financial sector operating stably', Xinhua said yesterday. The commentary also raised the question: is China capable of saving the world economy? After reviewing the nation's 'responsible action' of keeping the yuan exchange rate stable while other Asian currencies depreciated sharply during the Asian Financial Crisis of 1997, the commentary claimed the nation would continue to be 'an important stabilising force', although its low per capita gross domestic product meant it might not be able to save the world from the deepening and widening financial meltdown. Whether the nation will hold, sell or buy US bonds has also been a hot topic. The central government was rumoured to be preparing to help fund a substantial part of the US$700 billion in US Treasury debt required to finance the US bailout, because the US is the nation's primary market, buying US$117 billion of goods in the first half of this year. 'For foreign reserves, we should not emphasise reducing US assets. A big cut is against the mainland's interest,' said Ha Jiming , chief economist of the investment bank China International Capital based in Beijing. Some academics have suggested Beijing should sell US bonds to avoid further losses in the ailing US market. But others have argued that would materialise losses, worsen the meltdown and leave China with few other choices. 'It is also difficult for China to further buy US bonds, as our trade surplus is narrowing,' Mr Ha said. The trade surplus for the first nine months of the year was US$180.9 billion, down 2.6 per cent year on year. Economists expect growth in the surplus, the source of foreign reserves, will slow further with weakening external demand in coming months. The upbeat Xinhua commentary reiterated Premier Wen Jiabao's remarks last month on the mainland's three advantages in pursuing stable economic growth: a big domestic market; sufficient capital backed by high savings; and the improving quality of personnel. The target of doubling the per capita disposable income of rural residents by 2020, set at the Central Committee meeting, could boost domestic consumption, Xinhua said. Deputy finance minister Li Yong said in the US yesterday that Beijing would adopt a prudent economic policy to cope with the global slowdown. 'China will enhance the foresight, pertinence and flexibility in its macroeconomic management,' he said. 'It will take measures to maintain stability in the economy and in financial and capital markets so as to achieve sound and rapid economic growth.'