China faces wave of unrest in 2009

The warning was published in this week's Outlook (Liaowang) Magazine, issued by the official Xinhua news agency, which laid out the hazards facing China and its ruling Communist Party as growth slows amid global financial turmoil.

"Without doubt, now we're entering a peak period for mass incidents," a Xinhua reporter, Huang Huo, told the magazine, using the official euphemism for riots, protests and demonstrations.

"In 2009, Chinese society may face even more conflicts and clashes that will test even more the governing abilities of all levels of the Party and government."

Rising tension over jobs and income comes as China enters a year of politically sensitive anniversaries, especially the 20th anniversary of the 1989 armed crackdown on pro-democracy protests. That anniversary has galvanised a campaign by dissidents and rights advocates demanding democratic reforms.

The biggest risks to China's stability will come from a surge of graduating university students, facing a shrinking job market and diminished incomes, and from a tide of migrant labourers who have lost their jobs as export-driven factories have closed.

Including students who graduated in 2008 and had not found work, there would be more than 7 million university and college graduates hunting for jobs this year, Huang calculated.

But the government's goal of annual GDP growth for 2009 of 8 percent would generate only 8 million new jobs for the whole country, Huang added.

"If in 2009 there is a large number of unemployed rural migrant labourers who cannot find work for half a year or longer, milling around in cities with no income, the problem will be even more serious," said the reporter, Huang.

The magazine arrived with subscribers on Tuesday and the article also appeared on Xinhua's website (www.xinhuanet.com).

Chinese protests were becoming increasingly politicised and this would make it even more difficult for officials to defuse unrest, the report said.

"If they are forcefully crushed as anti-government actions, this will only further complicate the problem and the direct outcome will be a dramatic increase in antagonism between officials and the public," Huang said.

(Reporting by Chris Buckley; Editing by Nick Macfie)