China 'on track' to meet 7 .5% target

There were soothing words about the prospects for the world’s second-largest economy this week when China’s premier, Wen Jiabao, said his country was on track to meet this year’s 7.5 per cent growth target and had the fiscal and monetary scope to support growth.

“Be it monetary or fiscal, we still have ample strength,” Mr Wen told the World Economic Forum in Tianjin, adding that there was a fiscal stabilisation war chest of 100 billion yuan (€12.3 billion) available for “pre-emptive” measures.

He conceded the Chinese economy was under “notable downward pressure” but said measures had been introduced since May to support growth, including interest-rate cuts, reductions in the required bank reserves and tax reforms.