UN Trade Chief confident on Chinese economy

September 23rd is the third day of the 9th China-ASEAN Expo in Nanning, capital of South China's Guangxi Zhuang Autonomous Region. The Secretary-General of the UN Conference on Trade and Development, Supachai Panitchpakdi, is attending. In an interview, he says the world economy still faces a gloomy future this year, but global investors are still showing strong interest in emerging economies such as China. And he also expressed optimism for the Chinese economy. Due to the weak economic recovery in the US and Europe, and the slow growth rate of emerging economies, the Secretary General of the UN Conference on Trade and Development predicts global economic growth for this year will be below 2.5 percent and will not show strong recovery next year. He says the situation in Europe is not going to improve easily and the continent needs more time to recover. Meanwhile, he thinks US economic growth this year will be below 2 percent. But talking about capital flows, Supachai says direct foreign investment this year will amount to 1.6 trillion US dollars and most will flow to Asia, especially China and the ASEAN countries. Supachai Panitchpakdi, Sec. Gen. of UN Conf. on Trade and Dev't,said, "The rise in Foreign Direct investment has been consistent. The thing is that in spite of the slowdown of the world economy, we do see at the moment more economic restructuring. So there are more activities in the merges and acquisitions. So maybe the new flow of investment into China, into Asia in the forms of mergers. We still see the strong investment interest into China, particularly in areas that would be on a higher level of technology." But he expresses confidence in China's contiuing economic growth and predicts growth rate for the third quarter of 2012 will reach 7.6% and not fall below 8% for the whole year. Supachai Panitchpakdi said, "I have seen the new stimulus measures coming from the Chinese government in certain areas, more targeted probably in the western part of China. There is quite substantial economic growth in central and western part of China. So I do see for China as a whole, the growth will be around 8%, which will be sound for China." He warns China should control bad loans to fend off financial risks and in the coming years balance external and internal demands. He says he is pleased to see stimulus measures taken by the Chinese government have already expanded China's domestic consumption.