ESE Premier Wen Jiabao welcomed yesterday’s visit by German chancellor Angela Merkel by saying he was prepared to do more to help the Eurozone, yet admitted that Europe’s woes remain a headache for much of the global economy.
And even China’s comparatively strong position took a knock when Moody’s sent out a warning over the quality of its banks’ assets and slowing growth – yet Wen chose to focus on problems in the euro area.
“Recently, the European debt crisis has continued to worsen, giving rise to serious concerns in the international community,” he told reporters. “Frankly speaking, I am also worried.
“China is willing, on condition of fully evaluating the risks, to continue to invest in the Eurozone sovereign debt market, and strengthen communication and discussion with the European Union, the European Central Bank, the International Monetary Fund (IMF),” he said after a meeting with Merkel.
Yet Moody’s said in a note that all is not rosey in China itself, where double digit growth is slowing towards a rate closer to seven per cent per annum.
“The weakening asset quality and profit growth reflect China’s softening economy,” Moody’s noted. “We also see persistent credit tightening in the real estate sector and a slowdown of land-sale revenue for local governments as factors that will further erode banks’ asset quality, and believe the deterioration trend is just beginning.”
Meanwhile back in Germany, joblessness rose for a fifth month running in August, fresh data revealed. Merkel insisted yesterday that euro leaders have the “absolute political will” to solve the crisis.