EconoChina

A blog on Chinese economy & society

Posts Tagged ‘rumor

Stimulus rumor mill

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The world must be really desperate and addicted  to artificial highs that a low quality rumor from a tiny website would be picked by by Bloomberg.

China will announce in August a new stimulus package of possibly 4 trillion yuan ($586 billion), the China Business newspaper reported on its Web site, citing unidentified sources.

I have no idea where the 4 trillion figure comes from, but the proposal itself most likely is just part of China’s 12th five-year plan. (Yes, China still has those as befit a command economy, you know)

In its effort to move up the value chain and rebalance economy, China has adopted explicit industrial policies to promote “new technologies” like new energy, IT,¬† life science etc. And unlike Obama’s new energy initiatives, Chinese ones actually come with substantial investments as well. This August plan is just fleshing out guidelines announced with the 12th 5-yr plan, i.e. the money to be spent has already been budgeted and will be paid out entirely by the Treasury.

Bottom line: No New Money.

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Written by Cindy Luk

April 27, 2010 at 7:58 pm