Premier: plans worked out to boost auto industry

Shanghai, January 4 (Gasgoo.com) The Chinese government has finished drawing up policies to stimulate the steel and automobile industries, Premier Wen Jiabao said on Friday. He said the government is working on "a basket of measures" to stimulate market demands and prevent the economy from an excessive slowdown.

The nation's economic stimulus measures will go beyond the announced 4-trillion-yuan ($586 billion) package as more industry-specific policies are rolled out, Premier Wen said on Jan. 2 during his visit to Qingdao, a manufacturing and export hub in Shandong province. The government is refining and augmenting the package, because it was "rather preliminary" when announced on Nov. 9, he said.

Wen said the State Council, or Cabinet, is drawing up two major plans. One involves 10 programs to expand demand, further detailing and specifying the 10 stimulus measures kicked out last year. The other includes the readjustment and improvement of 10 pillar industries. Plans for the development of steel industry and automobile industry have been worked out and others are under way.

"All such plans, if strongly related to economic development, should be expedited," Wen said. Striking a note of confidence, the Chinese Premier said the country's vast market, abundant labor resources, sound financial system and adequate liquidity would help it tide over the global financial crisis.

In recent months, the government authorities have announced a slew of policies to boost the auto industry. These policies include abandoning road tolls, reducing fuel prices and subsidizing those who scrap old cars to buy new ones.

With more stimulus measures in the pipeline, the country's economy is expected to pick up steam in mid-2009 with full-year growth exceeding 8%, and the Chinese auto market will also see an upturn in the second half.