Encouraging figures on Chinese manufacturing, coupled with a new stimulus plan for its textile firms, suggest a slump in the world's third-largest economy may be bottoming out. Evidence elsewhere also raises hopes that the global economic crisis is finally stabilising, as Chris Brook-Carter explains.

I am losing count of the times I have sat and listened to friends and casual observers blaming the press for our rapid descent into economic turmoil here in the UK, and I suspect the same finger of blame is being pointed in other countries too.

Despite the evidence of economic mismanagement by governments, bankers and individuals who over-burdened themselves with debt, the story goes that the press has talked us into deeper woes by fixating on the doom and gloom. 

This, of course, is rubbish. It is the press' duty to report on what is happening. It is hardly our fault that all the news is bad at present and it would be remiss of us to paint an optimistic but untrue picture of events. 

That's not to say there aren't some corners of the press who are not revelling in the situation.

A senior minister, for example, here is the UK was shot down by certain members of the press last week for suggesting he saw some "green shoots" of a recovery - as if he was somehow irresponsible for trying to sow some seeds of hope.

In the end, figures out yesterday (4 January) suggest he may not have been completely off the mark - but more of that later.

So, make what you will of a new weekly column I saw in the US publication Forbes called The Weekly Layoff Report.

Almost 90,000 layoffs were announced at America's largest public companies last week and Forbes is keeping track.

Chinese economic decline
Things are hardly better here in the UK but most worrying of all has been the sharp decline of the Chinese economy, where a staggering 20m migrant workers have lost their jobs because of the nation's economic slowdown.

Clothing brands and retailers in particular have looked east for growth in the last decade and have been rightly proud of the expansion into China which has propped up stagnating growth rates in Western markets.

There will have been nervous looks then towards Beijing in recent months as China, as one observer put it, regressed "from presumptive super-power-in-the-making to panicky emerging market".

Even towards the end of last year we were hearing noises from clothing executives who believed they were sufficiently hedged against a contraction in the West because of their exposure in the Far East.

It was assumed that China's export machine would keep driving economic growth there. This belief has looked misplaced since November, when total exports (China's driving force) fell for the first time in seven years. The country's imports, meanwhile, fell 17%. 

In a country not known for candour from its State officials, the minister of industry said the country had a "serious problem" and was under "a lot of pressure".

There are signs things may get worse, China's exports fell by the most since 1999 in December and economic growth cooled to 6.8% in the fourth quarter, the weakest pace in seven years.

That sort of growth may seem like a stellar achievement compared to the contractions seen in the West, but it is estimated that China needs to achieve growth of 8% just to keep its ever-expanding population in employment. 

In the apparel and textile industry, exports slowed to 8.2% last year, from growth of 18.9% in 2007.

One report I read quoted an analyst saying he believed there was a 30% chance of an outright recession in China and a 70% chance of the economy growing between zero and 4% in 2009.

China is not alone, falling export demand is hammering economies across Asia Pacific, with South Korea in particular reporting horrible figures today showing that January shipments fell 32.8%.

The evidence suggests that conditions will remain treacherous for the foreseeable future.

Battling recession
However, there is also hope, since amongst all the seemingly depressing figures there are some signs the Chinese government is having success in battling recession with an economic stimulus package.

"According to economic figures for December, the domestic stimulus policies have achieved initial results," central bank governor Zhou Xiaochuan was quoted in local press saying.

Data out yesterday shows that China's official purchasing managers' index for January rose to 45.3, up from 41.2 in December and a record low of 38.8 reached in November.

A sub-50 reading still indicates that manufacturing is contracting. But, it may show that the economy is bottoming out. 

What is more, there were hints of a silver lining in the euro zone too, with its services Purchasing Managers' Index up to 42.2 in January from 42.1 in December.

Yes, the service industries fell again in Germany and Spain but the falls slowed markedly in France and Italy. Moreover, the steep contraction in the euro area's manufacturing sector also eased slightly in January.

The green shoots are small and may yet get trampled on by events, but at least you heard the good news here first.