Chinese economy able to get out of jaws of crisis

Special Report:Global Financial Crisis

By Chinese media writers Jiang Xufeng and Cheng Yunjie

BEIJING, Dec. 25 (Chinese media) -- Although the chill the

financial crisis has sent down the spines of many in China, in the Christmas

season some experts have found cheer in the economy's prospects.

Zhuang Jian, senior economist with the Asian

Development Bank's China Resident Mission, said China had weathered many

difficult times since reform and opening up began 30 years ago and "was also

able to escape the jaws of the financial crisis this time".

With the deepening of the financial and economic

crisis, the export-driven Chinese economy saw its export slide 2.2 percent year

on year last month, the first monthly decline since June 2001, trailing its

first monthly fiscal revenue decrease for 12 years this October.

What is also slowing the pace is the country's

utilization of foreign direct investment (FDI). It declined 36.52 percent year

on year in November to 5.322 billion U.S. dollars.

To slow the economic downturn, China rolled out a

stimulus program of 4 trillion yuan (586 billion U.S. dollars) last month, cut

interest rates five times since September to pump up growth, and unveiled a real

estate stimulus package last week.

Lansi Jiang, vice president of Volvo (China)

Investment Co., Ltd. told Chinese media some of her friends from foreign-funded

companies compared the stimulus program and other stimulating measures to the

"fireworks in the Beijing Olympics" which brought hope to people.

She pointed out that China took the crisis as a good

time for economic restructuring and would lay more importance on sustainable

development, energy saving and environmental protection, adding that her company

already had many projects in these areas in China.

Zhang Yansheng, head of the foreign economic research

institute of the National Development and Reform Commission, the top economic

planning body, said as the effects of Chinese government's macro-management

policies gradually surfaced, the world's fourth largest economy might recover in

the second half of next year, sooner than other major economies.

"China lacks no market or demand. What it needs to do

is to keep up confidence and turn the potential domestic demands into market

opportunities," Zhuang said.

Zhuang said to maintain economic growth was the

short-term goal for the country, while China needed to upgrade its exports

products mix and economic structures and increase citizens', especially

farmers', consumption for the long run.

With many export-oriented enterprises already feeling

the pinchfrom flagging world demand, the country was turning its attention to

the domestic market with a 1.3 billion population.

A subsidized household appliance program kicking off

in Chinese rural areas since last December attracted the limelight from both

home and abroad.

The government promised to grant a 13 percent subsidy

for colour TV sets, refrigerators, mobile phones, washing machines and ice boxes

for farmers' when buying these household appliances to improve 900 million rural

residents' living and boost domestic consumption.

Samsung, Panasonic, Nokia and other foreign brands

were on the list with leading domestic electronic manufacturers snapping the

bigger share of the cake that was estimated to grow to as large as near 1

trillion yuan in the coming four years.

Panasonic said it was doing its best to cut its

production cost of refrigerators to 2,500 yuan -- the threshold price set by the

government.

Ou Minggang, deputy editor-in-chief of "Chinese

Banker" magazine, said China's development still had great room as the country

was still on its fast track of industrialization, urban construction and

consumption structure upgrading.

Mei Xinyu, a trade expert with the Ministry of

Commerce, pointed out the financial crisis made it more difficult for Chinese

economy restructuring.

"Only through a bigger boost from domestic demand,

can we improve Chinese people's income and create more demands for new

products," Mei said.

He added that also through economic restructuring and

export upgrading, China could turn itself from a big trade country in to strong

trade nation.

Although export is a major engine for the country's

gross domestic product (GDP) growth, more than 60 percent of the world factory's

exports rely on orders from foreign countries.