Economic experts have weighed in on the recent Political Bureau of the Communist Party of China (CPC) Central Committee meeting on Friday, echoing the official stance of a need to expand China’s domestic demand and manage challenges to promote high-quality development.
Zhang Deyong, a researcher at the Institute of Finance and Economics of the Chinese Academy of Social Sciences, said that the foundation for the current economic recovery needs to be further consolidated, reported financial news outlet Yicai.
For example, Zhang said, the growth rate of retail industry is not as good as that of tourism and catering industry, in terms of investment structure, growth of private investment has been at a low level, while real estate investment is also still relatively low.
Meanwhile, Chinese think tank China Finance 40 Forum recently released a report recommending several key focus areas to invigorate the Chinese economy.
These include: lowering the country’s policy interest rate; driving down the real interest rate and stimulate market vitality; maintaining credit growth and infrastructure investment supported by policies; maintaining liquidity support for real estate enterprises; and lastly, directing subsidies to low-income groups and introduce measures to support consumption recovery.
At the Political Bureau of the CPC Central Committee meeting held in Beijing, it was emphasized that the recovery and expansion of demand are vital to the continuous recovery of the economy. Officials at the meeting concluded that a proactive fiscal policy must be strengthened to improve efficiency and prudent monetary policy must be precise and powerful enough to “form a joint force” to expand demand.
It was also noted that it is necessary to increase the income of urban and rural residents through multiple channels, improve the consumption environment and promote the consumption of services such as cultural tourism. It is also imperative to give full play to the guiding role of government investment and policy incentives, and effectively stimulate private investment, officials said at the meeting.
China’s GDP growth exceeded expectations by registering a 4.5-percent year-on-year increase in the first quarter of 2023 as economic activities regains momentum.