China sees signs economic growth is recovering but is watching closely to determine whether it needs to expand its huge stimulus effort as global conditions worsen, top economic officials said Friday. Zhang Ping, the chairman of the country's planning body, the National Development and Reform Commission, and central bank Gov. Zhou Xiaochuan said positive data showed Beijing's policies were working.

Foreign lenders that rushed into China in recent years are watching nervously as a number of companies there teeter on the brink of insolvency. Their worry: The nation's bankruptcy laws may leave them with virtually nothing, The Wall Street Journal reported. Several big Western investors--Citigroup Inc., hedge-fund manager Citadel Investment Group LLC, Credit Suisse Group and CLSA Capital Partners--are seeking to get back between $100 million and $200 million in loans extended to a Chinese steelmaker, according to people familiar with the matter.

The world waited with bated breath on Thursday for a beefed-up China stimulus that did not come, but the non-news should generate more a sense of relief than disappointment, Reuters reported. Relief that Beijing thinks its policies are hitting the mark, that the economy is getting back on its feet--and that it has the fiscal power to give an extra push, though only if needed.

Chinese Premier Wen Jiabao may announce new stimulus measures tomorrow, adding to a 4 trillion yuan ($585 billion) spending plan as the government tries to revive growth in the world’s third-biggest economy, Bloomberg reported. Wen will announce “a new stimulus package” in his annual address to the nation’s legislature, former statistics bureau head Li Deshui told reporters in Beijing.

Multinational companies are hiring less or cutting existing staff in China as they struggle through the global economic crisis, according to state media, Agence France-Presse reported. Nearly 70 percent of firms polled in a survey by FESCO, a Beijing-based, state-run recruitment agency targeting foreign companies, said they were scaling back their recruitment plans this year, the China Daily reported. In addition, 27 percent said they had already started laying off employees, the survey found after polling 356 of its clients in different industries across China, the newspaper said.

Russia has won $25 billion in loans from China in return for agreeing to supply oil from new fields in eastern Siberia for the next 20 years as Moscow seeks funds to see its oil industry through the financial crisis, the Financial Times reported. Transneft, Russia’s oil pipeline monopoly, said on Tuesday China had agreed to lend it $10 billion (€8 billion, £7 billion) and Rosneft, Russia’s state-controlled oil giant, $15 billion in return for 20 years’ worth of oil supplies.

Sanlu Group, the dairy firm at the heart of China's huge contaminated milk scandal, has been formally declared bankrupt, state media reported Thursday, citing a local court. Xinhua news agency said a court in the northern city of Shijiazhuang, where Sanlu is based, had accepted the company's bankruptcy filing as it faced 1.1 billion yuan (161 million dollars) of debt, Agence France-Presse reported. "The Shijiazhuang city intermediate court has formally declared Sanlu Group bankrupt," Xinhua said.

Australia’s A$42 billion ($28 billion) stimulus package may keep the nation from sliding into its first recession since 1991 by stoking consumer spending and building schools, roads and hospitals, Bloomberg reported. The Treasury department forecasts Prime Minister Kevin Rudd’s stimulus plan will help Australia defy a global recession by creating 90,000 jobs and boosting consumer spending. Almost one third of the package includes cash handouts of as much as A$900 to low and middle-income earners.

Lawyers saw a significant jump in insolvency, litigation and debt and corporate restructuring activities during the fourth quarter of last year--but they feel this may be just the tip of the iceberg, The Straits Times reported. With the worsening economic climate, recent months have seen law firms busy with the financing woes at listed companies, such as Chinese steel coil-maker FerroChina, China Printing & Dyeing, Jurong Technologies and electronics retailer TT International.

China has pledged to take all necessary measures to stimulate its economy and fuel consumer spending, but has rejected as “ridiculous” suggestions that its huge pool of domestic savings has been partly to blame for the global financial crisis, the Financial Times reported. In a rare interview, Wen Jiabao, China’s premier, said in London on Sunday that Beijing was considering fresh measures to boost its economy beyond its Rmb4,000 billion ($585 billion, €458 billion, £404 billion) fiscal package launched late last year.