Chinese Economy Set to Grow During Global Recession
Maura Lockwood, Cabot Headline News
March 17, 2009
March 17, 2009--Efforts to reverse the global economic downturn will likely make the Chinese economy, with lots of cash and a strong banking system, an even stronger competitor than before the crisis, The New York Times reported today.
China is the world's third largest economy after the United States and Japan. Its leaders are using its nearly $600 billion stimulus package to turn the economic crisis to a competitive advantage, according to The Times. The package is focusing on making its companies more competitive in markets at home and around the world, retraining migrant workers on an immense scale and expanding subsidies for research and development.
While American banks struggle to revive lending, Chinese banks have lent more in the past three months than in the preceding 12 months. The Times quotes a former China division chief at the International Monetary Fund, "The recent tweaks to the stimulus package indicate a sharper focus on the long-term competitiveness of Chinese industry. Higher expenditures on education and research and development, along with amounts already committed to infrastructure investment, will boost the economy's productivity."
The global recession has also already had some positive affects on the Chinese economy by slowing inflation, reversing dependence on exports and reducing the price of real estate, according to The Times.
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