China hopes ECB bond initiative will work

(BEIJING) - China said on Friday it hoped the European Central Bank's major initiative announced the day before would help steady the continent's sovereign debt problems.

The ECB plans to buy sovereign bonds on a massive scale in an effort to hold down soaring borrowing costs that crisis-wracked European countries say have hampered their recovery.

We "hope that this measure will stabilise the European debt situation and boost market confidence", foreign ministry spokesman Hong Lei said at a press briefing when asked about the deal.

Stock markets across Europe rose after the plan was revealed and borrowing costs fell in Spain and Italy, both potential beneficiaries of the scheme. The euro also rose in Asia on Friday.

Analysts also welcomed the scheme, with Berenberg Bank chief economist Holger Schmieding saying that "(ECB chief Mario) Draghi has delivered".

The plan was criticised by Germany for blurring the line between monetary and fiscal policy, but Draghi said: "We will do whatever it takes" to keep the eurozone together.

Hong reiterated China's support for Europe in resolving its debt crisis as quickly as possible, saying it was important to global economic recovery and the Chinese economy.

China's Prime Minister Wen Jiabao pledged last week during a visit by German leader Angela Merkel to continue investing in the European Union.