Global economy in grim state: China

“unbalanced recovery” might be the best option, at talks where senior US officials said the mood at home towards China was souring.
The remark marked Wang’s second dire comment on the world economy in just a few days. On Saturday, he said a “chronic” global recession was “certain” and China must focus on its domestic problems.

Policymakers globally have expressed increasing alarm at the risks facing the world economy, mainly stemming from financial contagion in Europe.
Yesterday, Singapore and Thailand forecast their economies would shrink in the fourth quarter and Japan posted a much bigger fall in October exports than expected.

“Global economic conditions remain grim, and ensuring economic recovery is the overriding priority,” said Wang, the top official steering China’s financial and trade policy, at the start of the second day of talks.

Wang, speaking at the annual US-China Joint Commission on Commerce and Trade, or JCCT, in the southwest Chinese city of Chengdu, also said China and the United States should work together to achieve balanced economic growth.

But his comments also suggested that Beijing should attend to bolstering China’s own growth before it worried about global imbalances – in other words, that a strong Chinese economy that brings a continued trade deficit with the United States would be better for the world economy than a slowdown in China itself.

“An unbalanced recovery would be better than a balanced recession,” he said.

“As major world economies, China and the United States would make a positive contribution to the world through their own steady development,” Wang told dozens of trade, investment, energy and agricultural officials from each government seated in a conference hall.
Wang’s Saturday comments on the global economy were the most downbeat to date from a senior Chinese policymaker and weighed down Chinese and Hong Kong stocks yesterday.
World markets were also weak, over worries about the eurozone debt crisis, which represents the biggest threat to the world economy. – Reuters.