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Stimulating Consumption

Nation to build its buying power: Hu

By Zhao Huanxin (China Daily)
Updated: 2009-11-14 10:02

China on Friday vowed to vigorously boost domestic demands and voiced its strong opposition to protectionism, saying both are key to bolstering the fledging global recovery.

"The world economy has shown positive signs of stabilization and recovery," President Hu Jintao told the Asia Pacific Economic Cooperation (APEC) CEO Summit.

But he cautioned that the economic upturn is not firmly established, with unsustainable patterns of global growth and major deficiencies in the international financial system.

"Our focus in countering the crisis is to expand domestic demand, especially consumer demand," Hu said.

In the face of the crisis, China has adjusted its macroeconomic policies. It has introduced a proactive fiscal policy and a moderately easy monetary policy, and implemented a stimulus package.

"We have been working hard to improve the consumption environment, adjust distribution relations, increase people's ability to spend and foster new areas of high consumer demand," he said.

The country has implemented measures to foster a new pattern of economic growth driven by consumption, investment and export, he said.

The measures are conducive to the steady and relatively fast growth of the Chinese economy and has also helped "the international effort cushion the impact of the financial crisis and restore world economic growth", the president said.

The president voiced China's strong opposition to the persisting protectionism, which he claimed is detrimental to global economic revival.

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"Protectionism will not help any country move out of the crisis. It can only pose a threat to the fragile momentum of economic recovery," he said.

The president stressed that only with trade and investment liberalization and facilitation can the world achieve economic recovery and growth.

The international financial crisis has fueled trade and investment protectionism in several areas, and developing countries, in particular, have been victimized by an increasing number of unreasonable trade and investment restrictions, the president said.

After delivering the speech, President Hu held one-on-one talks with Indonesian President Susilo, Peruvian President Alan Garcia, and his Chilean counterpart Michelle Bachelet Jeria about further developing relations.

China has become one of the biggest victims of protectionist measures, Vice-Minister of Commerce Yi Xiaozhun had said. In the first nine months of this year, 19 economies launched 88 probes into Chinese products, involving $10.2 billion of exported goods.

Raymond Chien, the chairman of Hong Kong subway operator MTR Corporation, said President Hu had sent out all the right messages. "The national policy commitment to develop the domestic market and to have the Chinese economy over the medium term to be more domestic-demand driven - that is highly encouraging," Chien said.

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