China unveils $586b plan to bolster weakening economy
Tuesday, 11 November 2008
From Fazle Rashid
NEW YORK, Nov 10: China fearing that its economy is cooling much faster than it had earlier anticipated in the face of a weaker international demand announced a massive economic stimulas programme designed at bolstering its weakening economy.
Beijing unveiled a plan with an outlay of $586 billion to be invested over the next two years to modernise and build anew an aging infrastructure.
The outlay, roughly 7.0 per cent of its gross domestic product (GDP) will be utilised to construct new railway tracks, subways, airports and rehabilitate areas devastated by the recent earthquake.
China's state council (the cabinet) in announcing the package acknowledged that the global financial crisis has been intensifying daily, adding "we must be fast and heavy-handed in expanding investment".
The new spending will begin immediately with $18 billion scheduled for the last quarter. Asian markets welcomed the news of the stimulas plan Hu Jintao, President of China spoke to president-elect Barack Obama about a variety of issues including the global financial crisis and how their countries might cooperate to help resolve the crisis, the New York Times (NYT) reported today.
The finance ministers and central bank governors of the G20 nations met
over the weekend in Sao Paulo, Brazil with the intent of laying the groundwork for a critical meeting of the world leaders in Washington on Saturday to tackle the global financial crisis. The chances are that G20 countries excluding the US under the present administration may arrive at a firm decision.
The United States is against the creation of a global regulator with cross border authority.
Brazil used the conference to blame the US for all the crises that have befallen the world.
European leaders will press the outgoing US president George Bush during the G20 summit to back reforms of the world's financial system. The plea will come as Britain, France, Germany and Italy see a clear lack of urgency over the reforms by the outgoing US president. Nicholas Sarkozy is planning to convene another summit within 100 days after Barack Obama's inauguration on January 20.
Meanwhile, the financial news pouring out from all corners of the globe point to a deepening economic crisis with no sign of abatement. India's truck makers are suspending production in the clearest sign yet that the global economic meltdown has begun to strike at the heart of Asia. Shipowners are forfeiting tens of millions of dollars to cancel contracts to buy vessels rendered uneconomic due to sharp downturn in the industry.
Sovereign Funds are losing enthusiasm for providing rescue financing to financial institutions or for investing in the US.
Dubai government has formed a high level committee to tackle effects of the widening financial crisis on Emirate's property market.
European service sector companies see no relief in sight from a recession next year expecting falling sales, revenues and profits with grim outlook forcing employers to cut jobs.
The Wall Street could see a wave of job cuts, roughly 70,000, to slash costs. The Wall Street anticipates turbulence and economic woes to continue well into 2009. There have already been over 150,000 job loss worldwide in banks. Peter Wuffli, former Chief Executive Officer (CEO) of cash strapped UBS Swissbank will give up his claim of $10 million bonus that he is eligible to get as his gesture of solidarity with the stricken Swiss bank.
NEW YORK, Nov 10: China fearing that its economy is cooling much faster than it had earlier anticipated in the face of a weaker international demand announced a massive economic stimulas programme designed at bolstering its weakening economy.
Beijing unveiled a plan with an outlay of $586 billion to be invested over the next two years to modernise and build anew an aging infrastructure.
The outlay, roughly 7.0 per cent of its gross domestic product (GDP) will be utilised to construct new railway tracks, subways, airports and rehabilitate areas devastated by the recent earthquake.
China's state council (the cabinet) in announcing the package acknowledged that the global financial crisis has been intensifying daily, adding "we must be fast and heavy-handed in expanding investment".
The new spending will begin immediately with $18 billion scheduled for the last quarter. Asian markets welcomed the news of the stimulas plan Hu Jintao, President of China spoke to president-elect Barack Obama about a variety of issues including the global financial crisis and how their countries might cooperate to help resolve the crisis, the New York Times (NYT) reported today.
The finance ministers and central bank governors of the G20 nations met
over the weekend in Sao Paulo, Brazil with the intent of laying the groundwork for a critical meeting of the world leaders in Washington on Saturday to tackle the global financial crisis. The chances are that G20 countries excluding the US under the present administration may arrive at a firm decision.
The United States is against the creation of a global regulator with cross border authority.
Brazil used the conference to blame the US for all the crises that have befallen the world.
European leaders will press the outgoing US president George Bush during the G20 summit to back reforms of the world's financial system. The plea will come as Britain, France, Germany and Italy see a clear lack of urgency over the reforms by the outgoing US president. Nicholas Sarkozy is planning to convene another summit within 100 days after Barack Obama's inauguration on January 20.
Meanwhile, the financial news pouring out from all corners of the globe point to a deepening economic crisis with no sign of abatement. India's truck makers are suspending production in the clearest sign yet that the global economic meltdown has begun to strike at the heart of Asia. Shipowners are forfeiting tens of millions of dollars to cancel contracts to buy vessels rendered uneconomic due to sharp downturn in the industry.
Sovereign Funds are losing enthusiasm for providing rescue financing to financial institutions or for investing in the US.
Dubai government has formed a high level committee to tackle effects of the widening financial crisis on Emirate's property market.
European service sector companies see no relief in sight from a recession next year expecting falling sales, revenues and profits with grim outlook forcing employers to cut jobs.
The Wall Street could see a wave of job cuts, roughly 70,000, to slash costs. The Wall Street anticipates turbulence and economic woes to continue well into 2009. There have already been over 150,000 job loss worldwide in banks. Peter Wuffli, former Chief Executive Officer (CEO) of cash strapped UBS Swissbank will give up his claim of $10 million bonus that he is eligible to get as his gesture of solidarity with the stricken Swiss bank.