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Chinese economists predict hard times

BEIJING: Unemployment driven by the global financial crisis could cause social unrest in China, although the economy looks set to reach its annual growth target of 8 per cent, according to a survey of leading Chinese economists.

Han Kang, vice-president of the National School of Administration in Beijing, warned that rising unemployment, particularly among university graduates and migrant rural workers could lead to unrest unless it was tackled urgently.

Mr. Han was one of 13 leading economists interviewed in a survey by Outlook Weekly magazine published by Xinhua who predicted economic growth would fall in the first half of 2009, but surge back above 8 per cent later in the year.

“Unemployment among university graduates and migrant workers, caused by the global economic downturn and the shrinking of export industries will put much stress on Chinese society in 2009, even social risks,” Mr. Han said. “The 4-trillion yuan stimulus plan, intended to boost the economy and ensure the 8 per cent growth rate, may not create as many steady jobs as expected.”.

The U.S. economic downturn would curb China’s exports growth in the medium term, said Wang Xiaoguang, director of Research Institution under National Development and Reform Commission.

Other economists in the survey included Jia Kang of the Ministry of Finance, who said: “The economic figures for the first quarter will be a little unpleasant; however, the economic trend of 2009 is still optimistic with a predicted annual growth of around 8.5 percent.” The government was still aiming at an 8 per cent economic growth rate for 2009 despite challenges, Liu Mingkang, chairman of the China Banking Regulatory Commission, said at a conference last month.

China’s economic growth slowed to 9.9 per cent in the first three quarters of 2008 after five years of double-digit increases. — Xinhua

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