Global crisis not over, China reforms to go on: Wen

Sun Apr 22, 2012 4:10pm EDT
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By Kevin Yao and Andreas Rinke

HANOVER, Germany (Reuters) - The global financial crisis is not over and technical innovation and investment will be key to sustaining what remains a "tortuous" recovery, Chinese Premier Wen Jiabao said on Sunday during a visit to Germany.

Wen also said China, the world's biggest exporter and second largest economy, would press on with reforms aimed at creating better legal protection for foreign investors -- a major concern for the growing number of German firms active in the country.

"Currently, the international financial crisis is not over and the global economic recovery is difficult and tortuous," Wen said at the Hanover trade fair that was also attended by German Chancellor Angela Merkel.

More investment in the real economy and technical innovation will be the most powerful drivers of global recovery, he said.

China's annual economic growth slowed to 8.1 percent in the first quarter of 2012 from 8.9 percent in the previous three months - the fifth consecutive quarter of slowdown.

"The reason why the global economy cannot walk out of the shadow of the (financial) crisis is also related to the lack of new growth points in the real economy," Wen said, adding that China and Germany had fared better than most during the crisis due to their strong manufacturing bases.

"(The two countries) will surely have an ever more important role to play in innovation and development of worldwide industry," he said.

Merkel, whose country has faced criticism over its insistence on reducing debts even during a time of poor growth in much of the developed world, said Germany wanted to strike a good balance between fiscal discipline and fostering growth.   Continued...

Chinese Premier Wen Jiabao delivers his speech during the opening ceremony of the Hanover fair in Hanover, April 22, 2012. China is this year's partner country of the industrial fair. The Hanover fair open its doors to the public on April 23 and will run to April 27, 2012. REUTERS/Ina Fassbender