planet for minerals but many of Rio Tinto's shareholders are deeply concerned about the further use of Chinese capital to fund the company's operations.

The reality is that the Chinese are largely proving that they are reliable partners though, as Premier Wen Jiabao put it on a recent visit to London, China is not in the business of saving capitalism from itself. But the way things are developing on the world stage he might just help to do that anyway, quite inadvertently.

No one realises better than Wen and his compatriots that China has as much to lose in a global downturn as any other nation. Already, in the last quarter of last year, economic growth had fallen to an annualised rate of 6.3 per cent, heady by western standards, but well short of the 8 per cent needed to keep the Chinese fully employed and out of trouble. It is also well down on the peak of 12.6 per cent in mid 2007. 

Over the last few months there has been a collapse in Chinese exports which has hit the most vulnerable — and the most potentially unstable — elements of the workforce, the rural migrants who have been leaving the major cities to return home. It is estimated that 20 million of the 130 million rural migrants have already lost their jobs and returned to an environment where there are no prospects of employment either. The frightening thing for the authorities is that these rural migrants do not even figure in the official employment statistics because they are not registered as unemployed giving rise to warnings from some communist party figures that there is a real risk of unrest.

The overall official unemployment figure has risen to 4.2 per cent of the urban workforce or 8.86 million, largely because of the dramatic fall-off in Chinese exports. But even that figure probably does not represent a true potential picture because anyone receiving some kind of a stipend does not come into the calculations. Employers, meanwhile, are being pressured not to lay off workers without clearance from the local authorities.

China, then, has every interest in restoring momentum to the world economy as Wen said in a rare interview with the Financial Times: 'Running our own affairs well is our contribution to mankind,' he said noting that a growth rate of 8 per cent would be attained whatever it took. On top of the $585 billion stimulus package already announced, he hinted that some of the nation's stash of more than a trillion dollars in foreign   exchange might be deployed to the same end. 'We must take forceful steps. Under special circumstances, necessary and extraordinary measures are required,' he said, 'we should not be restricted by conventions. Success or failure depends on the pace and intensity of those measures.'

Wen's battle plans are already in place with increased infrastructure spending as the centrepiece, much as it is a key element of the Obama plan. So while the Chinese leader may, ostensibly, have little time for capitalism, he admits to being a reader of Adam Smith and is clearly responding very much like a capitalist to the current crisis. Imagine any other communist Chinese leader uttering the words: 'We do believe that consumer spending is vital in boosting economic development.' But he does have a few wrinkles of his own that might well be emulated in the West — such as supplements for 74 million people on low income including increased salaries for 12 million teachers working in the state system.

In good socialist fashion, however, $212 billion will be spent on improved medical care and technological upgrading while a further $30 billion will be pumped into the Agriculture Bank of China.

Wen's approach through the Davos summit and his journey through Europe's capitals has been to pledge that China will play the role of a responsible international citizen as its contribution to bringing the crisis under control. That has been interpreted as meaning that Beijing would continue its policy of holding U.S. Treasury bonds. In his FT interview he confirmed this: 'We believe that it is important to stabilise the current Treasury bond market. To do so will be in the interest of shoring up market confidence, overcoming the global financial crisis and facilitating the early recovery of international markets.' But he also issued a veiled hint that such a policy might not prevail once the hurricane-force winds subside and China sought the best possible returns for its money.

Clearly the markets at home like what they hear from their leader since exchanges on the mainland of China have gained almost a third in value since the beginning of this year. That is a remarkable reversal of fortune over their 2008 performance, which resulted in a 60 per cent fall.

Not only have the exchanges in Shanghai and Shenzhen seen healthy recoveries in their prices but also, encouragingly, these have not been on small margins but on levels of business last seen in the bull market of 2007.
Wen's recovery medicine already seems to be working in the country's two hottest coastal regions and there is no doubt that commitments to help industries such as shipbuilding get back on their feet have made a contribution to the recovery in sentiment. That is a far cry from a broad-based national recovery but it has already revived talk of whether the momentum of the Chinese economy might be self-sufficient to the point that it could make its own way back from the brink without the prop of western markets as has so long been predicted.

Like it or not Mr Wen has the potential to give the West some new lessons from an enthusiastic convert.

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