German experts show confidence in China's economic growth amid crisis

Special Report:Global Financial Crisis

BEIJING, March 10 (Chinese media) -- Some German economists

have voiced optimism that China will be able to maintain steady, relatively fast

economic growth through such measures as the massive stimulus plan, the German

media reported.

Most Chinese so far have not been seriously affected

by the global financial and economic downturn, the Die Welt newspaper quoted an

expert as saying.

Christian Hofmann, who is manager of a German fund

and lives in Beijing, said apart from the unemployed and university graduates

who are finding it difficult to land a job, the majority of ordinary Chinese are

living normal lives.

"People consume, and are optimistic," Hofmann said.

The positive view was supported by other German

experts.

Carsten Herrmann-Pilath, a professor at the Frankfurt

School of Business and Management, said "China will suffer less in the crisis

than Western countries."

Herrmann-Pilath, who is also a Sinologist, said China

has "great potential" in its rural areas.

These regions had in the past been somewhat neglected

by the Chinese government, but now there are signs the government is changing

its strategy and paying more attention to these areas, he said.

About 600 million people who live in the rural areas

could benefit from the massive economic stimulus package announced by the

government last November, he said.

Herrmann-Pilath said farmers now have easier access

to credit for investment purposes. .

"If this is now changing, it could trigger a small

revolution in productivity and shore up the consumption of the rural

population," he said.

China's economy cooled to a seven-year low of 9

percent last year, and broke a five-year streak of double-digit expansion, as

the global financial crisis took its toll on the world's fastest growing

economy.

From the 4-trillion yuan ((about 580 billion U.S.

dollars) stimulus package that was announced in November, 370 billion yuan (54.4

billion dollars) will be used to improve the lives of people in the rural areas.

Earlier this week at the opening of China's annual

parliament session, Chinese Premier Wen Jiabao proposed an additional budgeted

fiscal deficit of 950 billion yuan (139.7 billion dollars) for 2009, a record

high in six decades and nearly three times over the last record of 319.8 billion

yuan set in 2003.

Die Welt reported that the details of China's

stimulus package remained unclear, but the plan is already one of the world's

largest which will affect the performance of the global economy.

The newspaper noted that the Chinese stock market had

in recent weeks responded positively to the government's efforts to tackle the

crisis.

Since the beginning of this year, Shanghai stock

market shares have risen by nearly 20 percent while the German stock index DAX

had lost nearly 25 percent, Die Welt said.

It said some German experts, however, have downplayed

the hope that China, with its economic growth, could "save the global economy."

Compared to the global economy, China is still

relatively weak and dependent on exports, Die Welt quoted the experts as saying.

But Herrmann-Pilath said China could emerge stronger

from the global financial crisis even it failed to maintain a growth rate of

eight percent.

He said five Chinese banks have been listed as the

world's largest banks while previous giants like Citygroup and Bank of America

have disappeared from the list.