At least one leader of a major nation is confident the financial and economic problems of Europe will be solved. China's Premier Wen Jiabao said he thinks the region will pull through. He admitted at the same time that troubles in Europe have become a large drag on the global economy. According to Reuters, Wen said he is confident the crisis-stricken eurozone can survive its nagging debt crisis.
Wen almost has to make optimistic statements, unless he wants to admit that China will be sucked more rapidly in the direction of recession. Chinese leaders have been accused of embellishing the good prospects of their national economy. Some analysts who follow the People's Republic claim that its GDP growth is much slower than reported. Part of the proof of this is the accumulation of inventory that is supposed to have been shipping overseas. The New York Times recently carried a report that some of this inventory has accumulated in Chinese warehouses and on ships.
Douglas A. McIntyre
Filed under: 24/7 Wall St. Wire, China, International Markets