U.S. economy to turn up later this year: Bernanke

WASHINGTON, May 5 (Xinhua) -- U.S. Federal Reserve Chairman Ben Bernanke told Congress Tuesday that the economy will begin to rebound later this year but the recovery will probably be slower than usual.

"We continue to expect economic activity to bottom out, then to turn up later this year," said Bernanke in prepared testimony to the Congress' Joint Economic Committee.

He noted that the housing market is beginning to stabilize and that the sharp inventory liquidation that has been in progress will slow over the next few quarters.

"Final demand should also be supported by fiscal and monetary stimulus," said Bernanke.

"An important caveat is that our forecast assumes continuing gradual repair of the financial system; a relapse in financial conditions would be a significant drag on economic activity and could cause the incipient recovery to stall," he added.

But the Federal Reserve chief also warned that even after a recovery gets under way, the rate of growth of real economic activity is likely to remain below its longer-run potential for a while.

"We expect that the recovery will only gradually gain momentum and that economic slack will diminish slowly," he said, "In particular, businesses are likely to be cautious about hiring, implying that the unemployment rate could remain high for a time, even after economic growth resumes."

The U.S. economy shrank at an annual rate of 6.1 percent in the first quarter of 2009, slightly smaller than the 6.3 percent drop in the previous quarter.

The worse-than-expected decline marked the third straight quarter of contraction for the world's biggest economy and signaled little improvement in a deep recession.

Many analysts were predicting the U.S. economy would shrink less in the current April-June period as the government's stimulus begins to take hold.

China's economy may have bottomed out: ADB president

Special Report: Global Financial Crisis

BALI, Indonesia, May 5 (Xinhua) -- The Chinese economy may have already bottomed out, and been on the recovery phase, said Haruhiko Kuroda, President of Asian Development Bank Tuesday.

Kuroda made the judgment at the press conference on the last day of the ADB's Annual Meeting, on the basis of his observations "in this meeting as well as from various statistics already released".

"China's economy is on recovery course and it could recovery much earlier than other economies, but of course, at the same time, we have to be very cautious," Kuroda told reporters.

Kuroda added that the South Korean economy had showed signs of recovery, and Japan's industrial production showed some signs of bottoming out.

"On the whole, I'm cautiously optimistic that Asia will recover by the end of next year," the President said.

ADB forecasts the growth rate for the Asian countries in 2009 is 3.4 percent and they will show a mild recovery in 2010 with a growth rate of more than 6 percent.

British ambassador to China: tackling climate change is compatible with economic recovery

Special Report:Global Financial Crisis

BEIJING, Feb. 7 (Xinhua) -- Britain's ambassador to China said Friday that "tackling climate change is compatible with economic recovery".

The ambassador's comments come in the wake of the meeting earlier this week in London between Chinese Premier Wen Jiabao and British Prime Minister Gordon Brown, at which they discussed environmental issues and plans for economic recovery.

Britain's ambassador William Ehrman wrote in an article entitled 'Why tackling climate change is an economic opportunity':"The perceived conflict between protecting economic growth (and jobs) and protecting the environment is being revealed as false."

"Through high-level meetings like the one that took place in London this week, and through the political statements emerging in the U.S., Europe, China and elsewhere, we are seeing the beginnings of an important shift, " said Ehrman, "We are learningthat tackling climate change is not merely compatible with economic recovery: it can actually help to unlock incentives for investment that will accelerate a global recovery and ease our dependence on oil."

According to Ehrman, when Premier Wen and Prime Minister Brownmet in London, they agreed on the importance of openness to free trade and co-ordinated macroeconomic policy responses to stimulate recovery, and used the occasion to reaffirm their commitment to tackling climate change through low carbon development in spite of the economic downturn."And that too is significant." Ehrman said.

"Tackling climate change will require leadership from all major countries in the world, but those countries that move first will be best placed to take full advantage of tomorrow's global economy. Many have already begun to respond."

"President Obama's Green Jobs package sets out new policies to put the U.S.A. on a low carbon path; the EU has already set ambitious targets to reduce our emissions by 60 percent by 2050, with the U.K. committing to do more."

"China too is taking a lead by announcing far reaching reforms to energy pricing policy as well as the inclusion of new money to promote energy efficiency in the fiscal stimulus package," stressed Ehrman in the article.

"Through all these interventions, the form of a sustainable, resilient recovery is becoming clear and its shape is low carbon, with an emphasis on major investment in energy efficiency, a fundamental shift towards renewables and nuclear power, a re-engineering of electricity grids to enable dynamic demand and supply, accelerated roll out of low carbon transport, increased research and development into new energy technologies, and up-graded investment in apprenticeships and science and engineering training programmes to ensure we have the skilled workforce that the low carbon economy will need," said Ehrman.

"Though a good beginning, these are just first steps," said Ehrman, the most recent scientific evidence presented a worsening picture of the sensitivity of the global climate to carbon emissions.

"In order to avert disaster we must, each one of us, redouble our effort," Ehrman stressed, "the U.K. will continue to work with China to achieve this and I am confident that through the collective action of governments, business, and of societies across the world, we can address this challenge."

China's real estate market still waits for recovery

Special Report: Boao Forum For Asia
2009

Special
Report:Global Financial
Crisis

BEIJING, April 20 -- Spring is yet to come to China's
housing market, and the government should take more measures to stimulate real
estate development, said Ren Zhiqiang, President of Huayuan Group, at a breakout
session of the 2009 Boao Forum for Asia Annual Conference in Hainan Province on
Friday.

China's real estate market has shown no sign of any
remarkable recovery so far. After the global financial crisis broke out, the
Chinese government worked out a 4-trillion-yuan emergency plan to boost the
domestic economy. To date, however, only some 200 billion yuan has gone to the
real estate market, and this investment is far from adequate to bring about any
radical change, said Ren Zhiqiang.

Ren Zhiqiang, President of Huayuan
Group, at a breakout session of the 2009 Boao Forum for Asia Annual
Conference in Hainan Province on April 17, 2009. (Photo:
china.org.cn)
Photo
Gallery

As the global financial crisis unfolds, China has
loosened some restrictions on the market in second-hand homes. Duties like stamp
tax and land appreciation tax have been cut down to some extent. Most banks,
however, are still taking a wait-and-see attitude because they have learnt a
serious lesson from the global financial crisis and are not confident of the
development of the domestic housing market, Shi Nengzi, a partner in Deloitte
Consulting China, pointed out.

To help the industry get through these tough times,
Ren Zhiqiang appealed to the government to launch more positive policies and
further reduce such taxes as business tax and tax on dividends.

Pan Shiyi, Chairman of SOHO China Ltd,
receives interview by journalists from Xinhua News Agency in Boao, a
scenic town in south China's Hainan Province, April 17, 2009. The Boao
Forum for Asia (BFA) Annual Conference 2009 kicked off here Friday.
(Xinhua/Zhao Yingquan)
Photo Gallery

Ren's view, however, was countered by Pan Shiyi,
another real estate developer who owned many skyscrapers in Beijing's Central
Business Districts. According to Pan, the government has taken all possible
measures to support the real estate market, and now the only thing left to do is
to wait and see the results.

(Source: china.org.cn)

Official: China centrally administered enterprises saw recovery in March

Special Report: Boao Forum For Asia
2009

Special Report:Global Financial Crisis

¡¤China's SOEs reported a 26% growth in profits in March from a year ago.
¡¤Li said China's economy might see a better-than-expected recovery.
¡¤Li urged enterprises to ensure enough cash liquidity amid the financial crisis.

BOAO, Hainan, April 19 (Xinhua) -- China's
centrally-administered state-owned enterprises (SOEs) reported a rebound in
performance in March with a 26 percent growth in profits from a year ago, said
an official with China's state asset watchdog Sunday.

The March figure was compared with a 33.3 percent
year-on-year drop in profits during the first two months.

Government policies for cushioning effects from the
global economic downturn had paid off, Li Rongrong, Minister in charge of
State-owned Assets Supervision and Administration Commission (SASAC), said
Sunday at the Boao Forum for Asia annual conference 2009 in Boao, Hainan
Province.

March profits also surged 86 percent from February,
he said. But the specific profits figure was not available.

Operating revenue fell 5.4 percent year on year, but
rose 25 percent from February.

Li said he was optimistic but prudent about the
future, and the country's economy might see a better-than-expected recovery with
joint efforts from the government and enterprises.

He urged enterprises to ensure enough cash liquidity
amid the financial crisis.

Talking about acquisitions abroad, he said, "money is
not a problem for these enterprises going overseas for acquisition, but
management is the top one".

Acquisition should be done within their capital,
management and technology capability, otherwise the results would be
catastrophic, he said.

He noted it was more important for major enterprises
to focus on tackling the economic slowdown, as they played an important role in
the national economy and also shouldered great responsibility.

The government released an announcement in February
to launch a special examination on major investment projects and mergers of
centrally-administered SOEs to prevent fiscal risks.

The enterprises should improve their management and
structure, and upgrade information system, Li said.

The 2008 profits of Chinese SOEs under direct central
government control recorded the first annual decline since 2002, falling more
than 30 percent year on year to 665.29 billion yuan (97.2 billion U.S. dollars).

Premier: China's stimulus package plan
paying off

BOAO, Hainan, April 18 (Xinhua) -- China's economic
stimulus package plan is already paying off, and positive changes have taken
place in the economy, Chinese Premier Wen Jiabao said Saturday.

Chinese Premier Wen Jiabao gives a
keynote speech at the opening plenary of Boao Forum for Asia (BFA) Annual
Conference 2009 in Boao, a scenic town in south China¡¯s Hainan Province,
April 18, 2009. The BFA Annual Conference 2009 opened here on Saturday
with the theme of ¡°Asia: Managing Beyond Crisis¡±. (Xinhua/Ma
Zhancheng)
Photo
Gallery

"The situation is better than expected," Wen said at the
opening ceremony of the Boao Forum for Asia annual conference 2009.

The "swift" and "decisive" measures taken by China to deal
with the crisis has proved essential for easing major problems in the economy,
shoring up confidence and stabilizing expectations, said the premier. Full story

Chinese shares rise 2.84% on recovery hopes

Special Report:Global Financial Crisis

An investor is inside a securities firm
inChengdu, southwest China's Sichuan ProvinceApril 13, 2009.
(Xinhua Photo)
Photo
Gallery

BEIJING, April 13 (Xinhua) -- Chinese shares rose
2.84 percent Monday, advancing for a third consecutive day to a nearly
eight-month high, on hopes that the economy had outperformed expectations in the
first quarter.

Premier Wen Jiabao told reporters in Thailand
Saturday that the economy showed signs of better-than-expected changes during
the first quarter as a result of the economic stimulus package.

The National Bureau of Statistics is scheduled to
release first-quarter growth data Thursday, which are expected to demonstrate a
recovery in the world's fastest-growing economy.

Data already announced have been positive. The
central bank said over the weekend that new loans increased 1.89 trillion yuan
(about 278 billion U.S. dollars) in March, the third straight month that new
loans exceeded 1 trillion yuan.

Economists said the March figure indicated that
China's liquidity was abundant, which was crucial to an economic recovery.

Wen said industrial output rose 8.3 percent in March,
up from a record low of 3.8 percent in the first two months of the year.

The benchmark Shanghai Composite Index reacted to the
positive news and closed at 2,513.7 points, up 69.48 points. The Shenzhen
Component Index was up 2.08 percent, or 194.36 points, to 9539.8.

Gains outnumbered losses by 616 to 205 in Shanghai
and 532 to 173 in Shenzhen.

Combined turnover rose to 280.46 billion yuan from
239.98 billion yuan the previous trading day.

Coal producers led gains Monday on speculation that
coal prices might be raised. The country's largest coal producer, China Shenhua
Energy, and six other producers, surged by the daily limit of 10 percent.

Steel stocks gained on hopes of more demand as
industrial output picked up. Baoshan Iron Steel, the nation's top steel
maker, rose 4 percent to 5.97 yuan.

PetroChina went up 4 percent to 11.94 yuan and
Sinopec rose 5.34 percent to 9.47 yuan on news that the country might soon
announce details on a stimulus package for the petrochemical sector.

Shipping lines and other cargo carriers gained
broadly on anticipation of an economic recovery. China Cosco rose by the daily
limit of 10 percent to 12.87 yuan. China Shipping Development climbed 10 percent
to 13.08 yuan. China Southern Airlines, one of the nation's three major
carriers, rose 6.22 percent to 6.15 yuan.

Securities analysts expressed optimism about
continued gains in the near term. Shanghai-based Shiji Investment said in a
report that heavyweights had showed signs of robust performance and the market
may rise to new highs.

Analysts at Huaxun, an on-line financial information
service, said the market would find support at about 2,450 to 2,470 on buoyant
confidence, with investors anticipating a recovery.

IMF chief: recovery could emerge in 2010

Special Report:Global Financial Crisis

WASHINGTON, April 16 (Xinhua) -- The global recession
may be ending and a recovery could emerge next year, Managing Director of the
International Monetary Fund (IMF) Dominique Strauss-Kahn said here on Thursday.

"The freefall in the global economy may be starting
to abate, with a recovery emerging in 2010," said Strauss-Kahn in a speech at
the National Press Club.

But "this depends crucially on the right policies
being adopted today," he noted.

He urged all countries to act together and
immediately adopt policies aimed at ending the recession.

"Of course, the solutions differ by country, but
there must be a coherent and coordinated response by the international
community," said the chief of the 185-member IMF.

Strauss-Kahn said "2009 will almost certainly be an
awful year -- we expect global growth to enter deeply negative territory."

"It originated in advanced economies, and spread like
wildfire across the world," he said. "This is a truly global crisis, and nobody
is escaping."

At the G-20 summit earlier this month in London,
leaders from rich countries and emerging market nations focused on urgent
actions needed to restore growth and on what must be done to repair some of the
underlying problems that caused the world crisis.

Strauss-Kahn said he was happy the G-20 leaders had
made progress on "three urgent priorities" -- the financial sector reform,
fiscal stimulus, and financial support.

To fix the financial sector is essential to get the
global economy moving again, he said. "Until this is done, attempts to restore
demand are likely to falter."

The IMF has been recommending, as early as January
2008, a 2 percent of GDP discretionary loosening for countries that have the
fiscal space to do so, according to the chief.

"Countries have largely delivered in 2009," he said.
"But efforts need to be sustained in 2010, because we are not out of the woods
just yet."

He also stressed that urgent actions should be taken
on the financing front, "especially to alleviate pressures on emerging markets,
to help them overcome the economic and social costs of the crisis."

"This is the area where the G-20 was boldest,
agreeing to triple the IMF's lending capacity to an unprecedented 750 billion
dollars," and "to at least double its concessional resources for lending to
low-income countries."

"We now have the resources to make a difference,"
said Strauss-Kahn.

The chief's remarks on the current global crisis came
a few days before the IMF holds its spring meetings with the World Bank on April
25-26 in Washington.