World Bank praises Beijing plan
The mainland's 4 trillion yuan (HK$4.54 trillion) stimulus package has won an approving nod from the World Bank, which says it will make a 'big contribution' to underpinning an expected 1 per cent growth in the world economy next year.
Justin Lin Yifu, who became the first World Bank chief economist outside Europe earlier this year, said the package would help fuel domestic demand and in turn imports of consumer goods from developed countries as well as foreign investment.
Aided by the package, the mainland would thus continue to play a key role in supporting global trade, which was nonetheless expected to contract 5.2 per cent next year for the first time since 1982 as the credit crisis continued to bite, Mr Lin said.
The turmoil in world financial markets had meanwhile prompted the World Bank to downgrade its economic forecast for high-income countries for 2008 to an expected 0.1 per cent contraction next year from an expected growth of 2 per cent.
'The stimulus package will create demand in the mainland and build a foundation for sustainable growth beyond 2010,' said Mr Lin (left). 'It will also drive demand for imports and investments from high-income countries. It is a big contribution.'
In what Premier Wen Jiabao described as 'the biggest contribution to the world', the stimulus package will see the central government pump expenditure and investment of 1 trillion yuan into various sectors such as transportation and energy infrastructure, the environment and public housing.