China's growing recession.

China's PM addresses The National People's Congress

The US is not the only country hit hard in these tough economic times. Recently the NPC, the National People's Congress (a congregation of the one-party rule of China). PM Wen Jiabao has stated that the centrally controlled government will increase spending, although they claim their debt of 950 billion Yuan is only 3% of their GDP and have projected 8% economic growth. China plans on increasing spending on social programs, healthcare and a projected 15% increase in spending on military programs.

The PRC is able to immidiately initiate new policy due to democratic centralism that is a linchpin in one-party, authoritarian rule. However, many leaders within the party, including Jiabao, have no clear plan on how to utilize the new spending. Nonetheless, it seems the party predicts a dreary future and are preparing for it as quickly as possible.

A question that comes to mind: how will this effect US-Sino relations? More importantly, will China's new policies drastically effect the amount of US debt they buy up?