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China's stimulus working but recovery hopes premature

China's stimulus working but recovery hopes premature article image

Chinese economists have indicated that the government's stimulus package has been well accepted, increasing demand for construction materials, autos and consumer goods. However, creeping growth in domestic demand make not quite make up for losses in China's exports. "Whether the current recovery is sustainable remains a question," said Wang Yuanhong, a senior economist with the government's State Information Center. World Bank country director for China David Dollar said the outlook for China was premature as the private sector had not yet shown adequate signs of recovery. "Until we see a recovery in private investment, it’s hard to get too excited about the future," said Dollar. "Private investment is the main source of job creation. It’s very important for private investment to come back if China’s going to be able to continue to grow at a high rate that is sustainable." The World Bank has forecast China's economic growth at about 6.5 percent this year.

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