Toyota will shut all its factories in Japan for 11 days to combat a global slowdown that is not only hitting company profits but could, a report says, unleash a wave of social unrest in China.
The two factors show how the crisis, likened to the Great Depression of the 1930s in its scope and severity, has spread from the US housing and banking sectors to threaten every part of the world economy.
China relies on strong growth to create jobs for its millions of migrant workers and graduates, but risks an upsurge in protests and riots in 2009 as rising unemployment stokes discontent, a state run magazine said today.
The unusually stark report was in this week's Outlook (Liaowang) Magazine, issued by the official Xinhua news agency.
"Without doubt, now we're entering a peak period for mass incidents," a senior Xinhua reporter, Huang Huo, told the magazine, using the official euphemism for riots and protests.
"In 2009, Chinese society may face even more conflicts and clashes that will test even more the governing abilities of all levels of the Party and government."
Researchers at the country's central bank forecast China's economy will probably grow a healthy 8 per cent this year, in contrast to many independent analysts who predict a much sharper slowdown.
Governments and central banks have been working overtime to try to limit the fallout of the global crisis, flooding the financial system with cash, cutting interest rates and increasing spending.
South Korea said today it aimed to create almost 142,000 jobs this year through infrastructure and environmental projects, part of a five-year, $38 billion plan to generate almost 1 million jobs.
Chile announced a $4 billion stimulus package based on public spending on infrastructure, subsidies and tax rebates.
Yesterday, US President-elect Barack Obama met with Republicans and Democrats in Congress seeking support for a stimulus package of up to $775 billion over two years, including hefty tax cuts.
But despite the best efforts of policymakers so far, economic indicators have been almost uniformly dire.
The latest grim reading came from Britain's Nationwide Building Society, which said house prices in the world's fifth biggest economy fell another 2.5 per cent in December to make 2008 the worst performing year on record.
In the United States, auto sales fell 36 per cent in December, figures showed yesterday, to close out the weakest year since 1992 in the world's biggest market.
The fall was led by a sales drop of 53 per cent at Chrysler LLC, 48 per cent at Hyundai Motor and 37 per cent at Toyota. Prospects for a quick recovery looked bleak.
Reuters