China to Lead Global Recovery?
The Chinese Manufacturing Index rose for the third month in a row as Beijing’s stimulus package takes effect on the economy. Amid signs that the Chinese economy appears to be bottoming out, stocks rose and new orders expanded for the first time in five months. Other positive signs include an increase in loans, growth in retail sales and an increase in electricity production and consumption in January. A measure of export orders also increased, in addition to employment, the first increase in six months. There are signs that this will continue as new manufacturing and construction projects are scheduled to break ground in the spring.
Amid these positive signs, the Chinese government has plans to further boost the economy by adding to the stimulus. Premier Wen Jiabao is expected to announce these new measures tomorrow after the Communist Party’s Politburo last month pledged a massive increase in government investment.
My Opinion: In light of these positive signs, it is difficult to argue how China will not emerge as stronger and more powerful than it already is. China is poised to lead the global economic recovery.
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