China's industrial growth crippled
Updated on 15 December 2008
China has revealed the crippling impact of the world economic slowdown on its previously booming industries.
It says its industrial growth has slowed to its lowest level since 1999.
Thirty years ago this week China's Communist rulers formally put the county on a capitalist road - encouraging private enterprise and opening up to the west.
But the economic downturn is proving more severe than many predicted.
Tens of millions of factory workers have already lost their jobs.
But the real problem for the government is the country's graduates who can't find work - 1.5 million this year with another six million entering the job market next year.
International Monetary Fund Managing Director Dominique Strauss-Kahn told a conference that growth in China, the world's fourth-biggest economy and accustomed to double-digit growth rates, could fall to 5 per cent next year from 9.7 per cent this year.
"We started with China at 11 per cent growth, then 8, then 7, then China will probably grow at 5 or 6 per cent," he told a conference in Madrid.
Strauss-Kahn said a large and diversified stimulus of about 2 per cent of world GDP - $1.2 trillion - was needed to reduce the risk of a damaging global recession.
"If we are not able to do that, then social unrest may happen in many places, including advanced economies," he said.
China in particular fears unrest if growth falls below the 8 per cent it says it needs to create enough jobs for the millions of people moving to cities from the countryside.
Chinese President Hu Jintao said: "Next year's employment market will be very serious, affected by the international financial crisis."
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