Beijing mulling new stimulus plan
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According to Chinese state media, the government in Beijing is drawing up a new economic stimulus plan, this time based on consumption rather than investment, amid signs that economic data for the first quarter is better than expected.
AFP - China is drawing up a fresh economic stimulus aimed at boosting consumption, state media reported Monday, on top of a previous multi-billion-dollar plan targeting investment.
The move comes as the government looks to increase personal spending in the world's most populous country due to plummeting exports amid the global financial meltdown.
Beijing will continue to drive economic growth with fiscal spending, the China Securities Journal reported, citing Gao Huiqing, of the economic forecast department at the State Information Centre, a government think tank.
"The (new) plan will focus on consumption," Gao was quoted as saying, without giving any further details.
Economic data for the first quarter due to be released this week was "better than expected," but it is still too early to conclude the economic downturn has bottomed out, Gao told the newspaper.
China last year announced a four-trillion-yuan (585-billion-dollar) stimulus package to combat the global downturn by spending on new infrastructure projects around the country.
Beijing has sought to get more of its 1.3 billion residents to spend more as its export-driven economy has been battered by falling demand in key markets such as the United States and Europe, which are mired in recession.
However, Premier Wen Jiabao said over the weekend that China's economy was performing better than expected and investment flows and demand had increased.
Wen said China's industrial output grew 8.3 percent in March from a year earlier, compared with year-on-year growth of 3.8 percent in the January-February period, according to remarks published by state media.