CHINA ECONOMY SEES STRONG GROWTH

AZG DAILY
22-01-2010

Economy

China has said its economy expanded by 8.7% in 2009, exceeding even
the government’s own initial expectations., BBC News reports.

The pace of change increased as the year went on, with growth in
the final quarter of 2009 increasing by 10.7% from the same period
a year earlier.

China is now on course to overtake Japan and become the world’s
second-biggest economy.

Japan announces its latest quarterly gross domestic product (GDP)
figures next month.

The Japanese economy is likely to have contracted by about 6% in 2009.

Jim O’Neill, chief economist at Goldman Sachs, said that China had
come up with "a very smart policy stimulus" and that some aspects of
the financial crisis may not have been a bad thing.

"[In] November 2008, they came up with a quick, aggressive fiscal and
monetary response which has worked," he told BBC Radio 4’s World At
One programme.

"They have replaced exports with domestic demand, both consumption and
investment… China has become more important as America [has become]
less, which is what the world needs."

He said part of the reason behind the global crisis was that the
world had become dependent on the US consumer, and the realisation
of that had now forced countries to stand up for themselves.

"The most important one is China and their economy is now being driven
by their own domestic economy, which will not only be increasingly
important for them but important for everyone else including –
directly and indirectly – people in Britain," he said.