英语文摘：EU's massive bailout to affect China

BEIJING, May 11 -- A nearly $1 trillion rescue package to prevent the Greek sovereign debt crisis spreading in Europe will impact on various facets of the Chinese economy, analysts have said.

The deal agreed earlier on Monday pledged $670 billion of loans and loan guarantees to any euro zone country needing funds, plus about $322 billion from the International Monetary Fund (IMF).

The aim is to keep the euro currency being torn apart and derailing the global economic recove

Markets cheered the news with world stocks rising nearly 3 percent. Global stocks as measured by MSCI were up 2.8 percent with its emerging market-only counterpart jumping more than 3 percent. The euro gained nearly 2 percent on the US dollar.

In China, the benchmark Shanghai Composite Index gained 10.38 points, or 0.4 percent while in Hong Kong, the Hang Seng Index rose 506.35 points, or 2.54 percent, to finish at 20,426.64.

In Europe, oil prices rebounded from last week's 14 percent sell-off, rising to $78 a barrel.

But Chinese analysts said the country faces uncertainties in its overseas financial portfolio, exports, currency policy and exit from the economic stimulus package.

"The rescue package will help the markets regain confidence and alleviate panic about not only the Greek economy, but also other European economies," said Zhang Xiaoji, senior economist with the State Council's Development Research Center.

"The deal will help create a stable economic environment and will help reduce people's concerns that it will lead to a double dip recession in Europe," said Stephen Joske, director of the China forecasting service at Economist Intelligence Unit.

Premier Wen Jiabao told Spanish Prime Minister Jose Luis Rodriguez Zapatero on Monday that China supports action to help Greece overcome its sovereign debt crisis. Spain currently holds the rotating presidency of the EU.

In a telephone conversation with Zapatero, Wen urged countries to coordinate economic policymaking, reform the international financial governance structure, maintain stability of currencies and prevent protectionism.

But it is too early to suggest the European situation has stabilized, said Yu Yongding, head of the China Society of World Economics.

"The Greek crisis fully exposed the weakness of the global economic recovery," Yu, a former member of the central bank's monetary policy committee, told China Daily. "It is hard to predict what will happen next."

The euro will probably remain weak, Yu said, while the dollar will strengthen.

"It will pose a challenge for China's policymakers, who want to diversify the country's overseas financial portfolio," he said.