Japan's Panasonic said it aims for double-digit sales growth this business year in the five major emerging markets it focuses on, including China and India, despite an estimated 10% decline in overall revenues.

The US and EU said China was giving its domestic industry access to cheap materials.

Semiconductor Manufacturing International Corp. (SMIC), China's biggest chipmaker, said recently that the country's demand for its products is recovering with orders in the third quarter expected to be better than in the second.

China, which has criticized protectionist moves elsewhere, is pushing ahead with efforts to ensure that its gargantuan economic stimulus package benefits domestic firms.

The World Bank has raised its forecast for growth in China this year from 6.5% to 7.2% amid signs that the economy is doing better than expected.

Canadian Solar plans to boost its annual production capacity from 620 megawatts to 800 MW by end-August, to meet an expected surge in demand, according to company president and CEO Shawn Qu.

Beijing is expected to unveil subsidized prices for solar power production as soon as the second half of the year, the South China Morning Post reported on Monday, citing an industry official.

A senior Chinese official has said China wants to produce one-fifth of its energy needs from renewable sources by 2020, a significant increase on the current target.

China said it will introduce a preferential tariff it will pay energy companies that use solar power for their generating capacity, as part of the government's push for greater use of clean technology.

Geithner said the two countries had already demonstrated they could co-operate in laying a foundation for economic recovery.

Optimists argue that the government's loose credit and fiscal policies have succeeded in staving off the worst of the economic downturn. However, there are growing concerns about the impact of these policies on the public finances.

Pioneering Taiwan industry leader Morris Chang says better focus is needed. "I think that the Chinese side is still intent on building their own integrated supply chain. They are assisting their design companies and their foundries. It's such a shortsighted policy..."

The SEMI PV Group has recommended that China should accelerate its adoption of PV-generated electricity to reach the global average by 2014.

US manufacturers and retailers that get products or components from China are increasingly concerned about quality, IP and rising costs in China, and more are looking at alternate sites, according to a study published on Thursday.

Strong macro factors could boost solar companies, though weak demand, falling module prices and dim profit reports from Chinese solar companies could pressure the sector in the near term.

Why, if investment is rising so rapidly, was its contribution to GDP growth in 1Q09 (2pp of the 6.1% total) so low? And why is electricity output still falling, down by 3.5% on year in April? The slowdown in on-year industrial production growth, to 7.3% in April from 8.3% in March, raises further concerns.

Taiwan's stock market has a rare chance to transform itself into Asia's Nasdaq, as the island improves its relationship with China, while capital markets in the US and Europe are largely frozen because of the financial crisis, says the head of private equity group H&Q Asia Pacific.

China's unprecedented growth in recent years has come at a terrible price. Ahead of most forecasts, China in 2008 passed the US to become the world's largest source of greenhouse gases.

"It looks to me now as if the markets are now pricing in a rapid recovery, that they're pricing in a V-shaped recession, which I consider extremely unlikely," said Krugman at a forum in Shanghai on May 12.

Applied Materials executives said customer confidence is improving, but cautioned that the company is seeing "a very dynamic environment" in all of its major segments. China's stimulus plans may continue to support cellphone and PC consumption there, said CEO Mike Splinter following release of fiscal Q2 financial results.

Worldwide, the rate of software piracy rose from 38% to 41%, because of the increase of Internet users in high-piracy locations such as China and India, the report found. Software piracy within the US, meanwhile, has remained flat.

China's exports in April were down 22.6% from a year ago, the sixth successive month of decline. But other data released on Tuesday suggest that Chinese government efforts to stimulate the economy are pushing up investment levels in the country.