Hu Jintao acknowledged China's economy faced "notable downward pressure", hitting exports and general business activityBeijing's Central Business District. President Hu Jintao vowed Saturday that China would keep its powerhouse economy growing steadily, seeking to ease fears that a Chinese slowdown could further cripple the moribund world economy
President Hu Jintao vowed Saturday to keep China's powerhouse economy on an even keel, seeking to ease fears that a Chinese slowdown could further cripple the struggling world economy. In a speech ahead of an annual summit of Asia-Pacific leaders held this year in the Russian Pacific port Vladivostok, Hu acknowledged China's economy faced "notable downward pressure", hitting exports and general business activity. But he pledged China would maintain stability in the world's second-largest economy by encouraging domestic demand and through a "pro-active fiscal policy". "We will work to maintain a balance among keeping steady and robust growth... and managing inflation expectations," Hu said in a speech. "We will boost domestic demand and maintain steady and robust growth as well as price stability." The gathering of the 21-member Asia-Pacific Economic Cooperation bloc, which accounts for nearly half of world trade, opens later Saturday with concern growing over the eurozone crisis and a slackening in China's usual super-charged growth. China's manufacturing activity fell to its lowest level in more than three years in August, according to a closely watched survey compiled by British banking giant HSBC. This came after economic growth slowed to 7.6 percent in the second quarter, the worst performance in three years and the sixth straight quarter of slower growth. A slowdown in China's economy is perceived as the biggest risk to Asia's economic growth, according to a survey of regional powerbrokers released in Vladivostok ahead of the summit. The survey by the Pacific Economic Cooperation Council (PECC) think-tank said concern over the effects of a slowdown in China outweighed fears over Europe's sovereign debt troubles. "In terms of risks to growth, regional opinion leaders were more worried about the impact of a slowdown in China than they were for slowdowns in Europe and the United States, albeit by a slight margin," it said. Hu, however, touted China's 7.8 percent growth in the first half of the year as an achievement when the rest of the world was in the doldrums, saying Beijing "has ensured the stable performance of China's economy". But he noted the sluggish world recovery faced continued challenges. "The underlying impact of the international financial crisis is far from over. Some countries are confronted with complex and difficult sovereign debt problems," he said. He added that "the grave challenges in the global economy" were having an impact in the Asia-Pacific and urged steps such as greater government spending on infrastructure to help boost development. China has approved a massive infrastructure package worth more than 1.0 trillion yuan ($158 billion) and encompassing 55 projects ranging from subway lines to highways, Chinese state media reported on Friday. The reports described the package of projects as a "stimulus plan" although the government has not termed it as such.