China's strong growth based on sound finances: OECD
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China is leading the world economy out of recession with strong growth anchored in secure government stimulus measures, the Organization for Economic Cooperation and Development (OECD) said Tuesday.
"The Chinese government's swift and vigorous action to support its economy has contained the impact of the global recession," OECD Chief Economist and Deputy Secretary-General Pier Carlo Padoan said while launching a new report, the Economic Survey of China.
"By helping to re-balance China's economy toward stronger domestic demand, the stimulus is also benefiting the rest of the world," he added.
The OECD report said that China could well overtake the United States to become the leading producer of manufactured goods in the next five to seven years.
The Paris-based institution attributed China's sustained growth in difficult times to the country's well-balanced finances.
The gross public debt accounted for only 21 percent of the country's GDP in 2008 and that China's stimulus measures are expected to boost up the debt-GDP ratio by another 3 percent in 2010, the OECD report said.
In comparison, the report added, the gross public debt of OECD countries is projected to almost equal their total GDP this year and may even exceed it in 2011.
Admitting that China can afford the extra government spending while its public finances remain strong, the OECD even suggested that China should step up its public spending to support social reforms in areas such as education, welfare assistance, pensions and public health, as ways to sustain long-term development.
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