China eyes fresh stimulus to jumpstart economy

China is planning to inject new life into the economy aimed at boosting consumption, state media reported on Monday.

In November China had announced a $4-trillion-yuan ($585 billion) stimulus package to combat the global downturn by spending on new infrastructure projects around the country.

On top of this Beijing will continue to drive economic growth with fiscal spending, the China Securities Journal reported, quoting Gao Huiqing, a senior official at the economic forecast department at the State Information Centre, a government think tank.

"The (new) plan will focus on consumption," Gao was quoted as saying, without giving any further details.

Economic data for the first quarter due to be released this week was "better than expected," but it is still too early to conclude the economic downturn has bottomed out, Gao told the newspaper.

Beijing has sought to get more of its 1.3 billion residents to spend more as its export-driven economy has been battered by falling demand in key markets such as the United States and Europe, which are mired in recession.

However, prime minster Wen Jiabao said in Thailand on April 11 on the sidelines of the ASEAN Summit that Chinese economy is showing signs of positive change from the ongoing global economic downturn.

Wen said that because of China's unprecedented 4-trillion-yuan stimulus package, the economy showed better-than-expected signs of improvement in the first quarter this year.

Domestic demand has been steadily on the rise and investment on fixed assets and consumption demand grew rapidly.

The purchasing manager's index and entrepreneur confidence index grew steadily, which showed China's economy beginning to rebound in some sectors. The huge package also boosted market confidence and economic vitality. Transactions in stock markets and real estate sectors have expanded.

"As the crisis has not touched its bottom, we can hardly say that China's economy alone has got out of the recession. We will try our best to bring the impact of the crisis to a minimum," said Wen.

Wen said that China should spare no time in implementing various measures included in the stimulus package.

Wen further noted that central government has been attaching great importance to the development of the financial industry in Hong Kong. Meanwhile, HK also needs to search for new areas of economic growth, for instance, trade and logistics, tourism, medical care, sci-tech, high tech, laying foundations for further economic development.

As of the economic development in Macau, the premier noted that the economy in Macau largely depends on gambling industry.

According to the customs bureau, China's exports rose 39 per cent in March from a month earlier. Overseas sales declined 17.1 per cent from a year earlier, down from a record 25.7 percent drop in February.

Industrial output up 8.3 per cent in March
China's industrial output rose 8.3 per cent in March, in a sign that the November stimulus package is kicking in, Wen said in an interview published on Monday.

Last month's growth accelerated from the 3.8 per cent rise in the first two months as domestic demand continued to improve, Wen said.

Fixed asset investment and retail sales, which measure spending on infrastructure and consumption respectively, also increased quickly in the first quarter.

The National Statistics Bureau is slated to release first quarter data on the Chinese economy on Thursday.

Chinese rose to the highest in almost eight months after the premier said the economy showed signs of a better-than-expected recovery in the first quarter.

The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, rose 69.48, or 2.8 per cent, to 2,513.70 at the close on Monday, the highest since August 20.

The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, gained 2.4 per cent to 2,656.52.