"The effect of fiscal support cannot be weakened when the world economy is undergoing a full-scale downturn," said Xiang Huaicheng, China's Finance Minister.

Xiang said the government had decided to issue the same amount of capital in special bonds this year as 2001 to offset the slowing export growth.

Xiang maintained confidence in his long-term plan for issuing treasury bonds.

"China's current debt risk is under good control, and there won't be a big problem if we continue to issue treasury bonds this year and next," he said.

China implemented an expansionary fiscal policy in 1998 after the Asian economic crisis, issuing 510 billion yuan in special bonds for infrastructure in the past four years to rein in the financial operation.

Slowing exports since last year give another reason to highlight the need for fiscal stimulus. Exports rose just 6.8 percent year on year in 2001, sharply off the sizzling 27.8 percent in 2000.

The 2002 picture is much grimmer. Shi Guangsheng said he was hoping for exports growth this year above zero.

(eastday.com January 17, 2002)