Wen tries to soothe China

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Wen tries to soothe China
http://www.thestar.com/World/Columnist/article/602279

Mar 14, 2009 04:30 AM


Chinese Premier Wen Jiabao, seen at his news conference in Beijing March 13, 2009, says China is prepared to tackle even more difficult economic times

Popular premier offers his nation reassurances economy will begin to recover by next year

BEIJING – Calling confidence "more important than gold," Chinese Premier Wen Jiabao reached out to his nation yesterday, calming nerves and reassuring the people that economic recovery will come to China – perhaps as early as next year.

If the $730 billion stimulus package announced last fall isn't enough, he said, government contingency plans are in the pipeline. The reassurance comes at a time when China, a nation that depends on trade, appears to be peering down a widening abyss: last month alone exports plunged 25 per cent, year over year.

"We already have plans prepared to tackle even more difficult times," Wen assured the nation during his only scheduled news conference of the year. "We've set aside adequate ammunition. We can introduce new stimulus policies at any time."

Easily China's most well-liked political figure – for his tireless work during the Sichuan earthquake last year, he was affectionately called "Grandpa Wen" – the premier is consistently the Communist party's go-to leader in times of crises.

Yesterday he sought to persuade the people that the Communist party's leadership in the centre of the financial storm was prudent, patient and wise.

The news conference came at the close of a nine-day meeting of the National Party Congress, a largely powerless parliament that rubber-stamps Communist party policies previously approved behind closed doors.

"First and foremost, we need very strong confidence," Wen said, in a tone that sounded almost schoolmasterly. "Only when we have confidence can we have courage and strength – and only when we have courage and strength can we overcome difficulties."

Last week, Wen warned that the country was heading into its "most difficult year" of the young century.

This week, the government revealed Chinese exports appeared to be in free fall.

But yesterday, Wen was more encouraging, saying he believed "next year, both China and the world will be better off."

But that didn't mean he didn't have his worries. Without sounding like he was hectoring the United States, Wen said he was concerned about China's huge holdings of U.S. Treasury bills – said to constitute half of China's whopping $2 trillion (U.S.) in foreign reserves.

"We have a huge amount of loans to the United States," Wen remarked. "Of course, we are concerned about the safety of our assets. To be honest, I'm a little bit worried."

In response, White House press secretary Robert Gibb said yesterday that China should rest assured because investments in the U.S. are the safest in the world.

While Wen gave no guarantees that China's economy would grow by 8 per cent – the pace at which most economists say it must in order to create enough jobs to avoid social upheaval – he said it remained the government's goal.

"It will be a difficult job" to achieve, he admitted. But if the entire nation pulled together, he said, it was "possible."

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