China announced a huge economic stimulus package Sunday aimed at bolstering its weakening economy and, in the process, perhaps helping to counter the effects of the global economic slowdown. China has unveiled a CNY 4 trillion investment package to cushion the country"s economy from a dramatic slowdown as the global financial crisis continues to unfold.
The move to bolster economic growth comes after China"s GDP slowed in the third quarter of this year to 9%YoY the lowest level in five years. The country"s export-driven economic expansion is expected to drop further in coming months as recession grips various countries around the world.
The State Council, the country"s highest decision making body, identified in its announcement 10 key areas for spending, including upgrading infrastructure in both rural and urban regions, improving the country"s health care and education systems, increasing environmental protection and increasing pensions for farmers and low-income citizens.
According to the State Council the package total, which is equal to almost 20% of China"s 2007 GDP, will be spent by the end of 2010. The package will also aid reform of the value-added tax system, which, it is estimated, may save enterprises in China as much as CNY 120 billion.