Chinese President Xi Jinping has pledged to boost domestic consumption and investment to anchor economic expectations and improve business confidence, according to an article published Wednesday by the ruling Communist Party journal Qiushi.
The government should prioritize the recovery and expansion of consumption by unleashing the potential of the domestic market and increasing residents’ income, especially low and middle-income groups, Xi said in a speech dated back in December during the country’s annual key economic work conference.
Chinese policy-makers usually make key economic decisions at this year-end meeting, including setting growth targets for the following year. China will unveil its economic targets at an annual legislative meeting early next month.
Qiushi cited Xi as urging the government to step up consumer loans and offer more support for spending on home upgrading, electric vehicles, elderly care, education, culture and sports.
Economists have been debating whether the Chinese economy could bounce back to its pre-pandemic growth path, mainly through domestic consumption this year, as a global economic slowdown is expected to weigh on its export sector.
The Chinese president also said government-led investment should be used as an incentive to encourage all types of investment, especially amid expectations of low private investment.
He called on state policy banks to provide financing for government-backed investment and allow more private investors to take part in major infrastructure projects.
Xi also said to let China’s exports continue to be a pillar for the economy and to stabilize exports to developed countries, while expanding shipments to emerging economies. He also said to diversify China’s imports and support Chinese companies in importing energy and mining resources.
He also reiterated the need to prevent systemic risks in the country’s property sector and urged the government to come up with a long-term plan to replace the development model for China’s property sector that was fueled by high leverage.
Xi also asked local governments to step up efforts to dispose of hidden debt by improving debt structure and lowering interest payments.
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