Premier Wen Jiabao said confidence was necessary to boost the economy

China’s Premier Wen Jiabao has said he expects that China and the rest of the world will be better off by next year.

He was speaking at a news conference in Beijing at the end of the annual session of China’s National People’s Congress - the country’s parliament.

He said China had enough resources to boost its $585bn (£413bn) economic stimulus plan if needed.

But Mr Wen said he was worried about the billions of dollars of currency reserves China had loaned the US.

He also said the situation in Tibet was "peaceful and stable", proving China’s policies in the region were "correct".

The news conference at the end of the annual NPC session is the only time that the premier takes questions from reporters.

‘Difficult year’

Mr Wen said confidence would be necessary to overcome China - and the world’s - economic difficulties.

The global economic downturn is hitting China’s growth

"Confidence is more important than gold or money," he said.

"First and foremost we need very strong confidence. Only when we have confidence can we have courage and strength, and only when we have courage and strength can we overcome difficulties.

"I expect that next year both China and the world will be better off."

Opening the NPC session nine days ago, Mr Wen said that this year would be the most difficult China has faced this century.

Two days ago, official figures were released showing that Chinese exports plunged by more than a quarter in February from a year ago, to $64.9bn (£47.3bn), and imports fell by 24.1% to $60.1bn.

At Friday’s news conference, Mr Wen said the government’s economic stimulus programme included 1.18tr yuan ($172bn) in central government spending on "public welfare, technological innovation, environmental protection and infrastructure projects".

Costing $585bn (£413bn) altogether, the economic stimulus programme was announced by the government in November.

Mr Wen said the authorities had enough "ammunition" to launch new economic stimulus policies in case of greater difficulties.

The government is targeting annual growth of 8% and wants to boost consumption and raise consumer demand.

BBC News