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China’s economy shows signs of growth

Scott Tong Oct 22, 2009
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China’s economy shows signs of growth

Scott Tong Oct 22, 2009
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TEXT OF STORY

Bill Radke: China said its economy grew by almost 9 percent last quarter. And all that with no help from American shoppers. Since the global recession began, Chinese exports have taken a licking. And yet China keeps on… well, you know. From Shanghai, Marketplace’s Scott Tong reports.


Scott Tong: When Chinese exports fell last year, the government came in said “we’re here to help.” They did. Much of the 8.9 percent growth is from state spending on roads, train tracks and health care. Now, China’s private sector’s back, too — factory output rose nearly 14 percent last month.

Andy Rothman is with brokerage CLSA.

Andy Rothman: The Chinese economy was the first into the recession, the first out of the recession. And now Beijing is the first government to be implementing an exit strategy.

China’s easing off its stimulus, in the form of reduced bank lending. That makes some investors nervous. There’s also concern that the easy money in China could turn into bad loans and stock bubbles. For now, though, the party’s still going. Chinese consumers are spending.

Rothman: And unlike the United States, there’s no debt here. So as soon as they got more optimistic, they went out and started buying cars.

And apartments. And furniture to fill those apartments. In the past year, Chinese retail sales grew 15 percent.

In Shanghai, I’m Scott Tong for Marketplace.

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