China to lead world economic recovery


A recent World Bank report has suggested that amongst the world’s major economies, the Chinese economy will be the first to emerge out of the global slowdown. The World Bank predicted China to grow at almost 8.4 percent and that would be enough to offset the slump in the US, Japan and the EU during the first three quarters this year.

China’s $586 billion stimulus has spurred road-building and other works in addition to funding the banks’ spending spree and creating new jobs. However, experts have warned that it is going to take much more than just the stimulus plan if the recovery has to be sustained next year. They have also stressed on emphasizing more on consumption and services in comparison to investment and industry.

The government has also encouraged consumers to spend on education, health and termed it as a useful step to persuade consumers to save less for the time being.

Countries in East Asia and the Pacific have also been helped by the growth in the Chinese economy. However, the ‘rebound’ in GDP figures there is yet to translate into a ‘recovery’.