Chinese Premier Wen Jiabao said the economy showed better than expected improvement in the first quarter, dpa quoted state media as saying today. Speaking to reporters in Thailand, the premier said that while down on last year's figures, imports and exports were growing on a month-on-month basis, the official Xinhua news agency reported. Domestic demand and investment in fixed assets also rose, Wen said, indicating that some sectors and enterprises in China were starting to show gradual recovery. In response to the economic crisis, the government unleashed a 4 trillion yuan (586 billion dollars) stimulus package aimed at increasing domestic demand for resources like metals. "The first-quarter economic figures could indicate the initial result of our efforts to stimulate the economy," Wen said. However, most figures are significantly down on those of last year. The country's central bank on Friday revealed that the growth rate of China's foreign exchange reserves had significantly slowed. The reserves, the world's largest, rose 16 per cent year-on-year to 1.9537 trillion dollars by the end of March, the Peoples' Bank of China indicated on Saturday. This represents an increase of 7.7 billion dollars for the first quarter, but is 146.2 billion dollars lower than in the first quarter of 2008. It was also substantially below the fourth-quarter 2008 gain of nearly 45 billion dollars. The slower growth in reserves was attributed to reduced exports in recent months. Exports fell 17.5 per cent year-on-year in January, 25.7 per cent in February and 17.1 per cent in March, according to the official Xinhua news agency. Foreign direct investment also dropped by 26.2 per cent in the first two months. Premier Wen acknowledged that the fallout from the global economic crisis is not over yet. "China's economy has shown some positive signs, but we can all see that our economy still faces some very big difficulties," Wen said.
