Main Insights from China's Gradual Pro-Growth Measures
Highlights from China's gradual pro-growth strategies.
TroibNews 
Senior Chinese officials provided a media briefing on Tuesday to outline the government's strategies aimed at further stimulating the economy, following a series of new stimulus measures that have driven the stock market to record levels.
Key points from the press conference, which took place two weeks after China's leadership convened to establish the country's economic work plan, are as follows:
**Confidence in Achieving 2024 Growth Target**
Officials expressed optimism regarding the attainment of China's growth target for 2024, citing an improvement in market sentiment. This confidence is bolstered by a swift recovery in the purchasing managers' index for the manufacturing sector, a significant surge in the stock market, and strong consumption trends seen during the National Day holiday.
In the first half of this year, China’s economy recorded a growth rate of 5 percent, establishing a solid foundation for the annual target of around 5 percent. The overall economic landscape remained stable in July and August, although some indicators exhibited fluctuations. Analysts forecast that growth for the third quarter will fall between 4.6 percent and 4.8 percent.
**Early Release of Investment Plans for Next Year**
On the investment side, the issuance of ultra-long special treasury bonds will continue into next year, with investment areas being optimized to align with major national strategies and enhance security capacities in critical sectors.
Investment projects valued at 200 billion yuan that are planned for next year will be announced this year to assist local governments in expediting preliminary work and construction efforts.
A portion of these projects will focus on urban renewal, primarily involving the development of infrastructure for gas, water, sewage, and heating systems, which is anticipated to generate approximately 4 trillion yuan in investment demand over the next five years.
**Accelerating Local Projects**
This year, a total of 3.12 trillion yuan in special-purpose bonds for local governments has been allocated for project development. By the end of September, 2.83 trillion yuan had been issued, leaving 290 billion yuan remaining.
Local governments are being encouraged to complete the issuance process before November. The upcoming steps will aim to maximize the impact of these special bonds, ensuring that funded projects commence as soon as possible.
Furthermore, the National Development and Reform Commission and the Ministry of Finance are exploring new measures to enhance the management of these bonds.
**Boosting Domestic Consumption Support**
The government is increasing its support for large-scale upgrades across various appliances and initiatives for trading in old products for new ones. These efforts are designed not only to stimulate demand but also to support energy conservation, reduce carbon emissions, and facilitate a broader green transition.
Currently, comprehensive implementation guidelines for the trade-in of consumer goods have been issued, funding is fully allocated, and policies have been implemented.
These initiatives have resulted in a significant rebound in passenger car retail sales and a recovery in home appliance sales. There is a pressing need to intensify the execution of relevant policies to sustain growth in commodity consumption.
**No Tolerance for Unlawful Business Enforcement**
The actions of administrative authorities with respect to businesses will be more closely regulated, emphasizing the adoption of inclusive, cautious, and flexible enforcement strategies. Efforts will be made to prevent unlawful cross-regional enforcement, profit-driven enforcement, arbitrary fines, excessive inspections, and unfounded seizures. Regions exhibiting unusual increases in forfeiture income will be alerted, and inspections may be conducted as necessary.
Debra A Smith for TROIB News
Key points from the press conference, which took place two weeks after China's leadership convened to establish the country's economic work plan, are as follows:
**Confidence in Achieving 2024 Growth Target**
Officials expressed optimism regarding the attainment of China's growth target for 2024, citing an improvement in market sentiment. This confidence is bolstered by a swift recovery in the purchasing managers' index for the manufacturing sector, a significant surge in the stock market, and strong consumption trends seen during the National Day holiday.
In the first half of this year, China’s economy recorded a growth rate of 5 percent, establishing a solid foundation for the annual target of around 5 percent. The overall economic landscape remained stable in July and August, although some indicators exhibited fluctuations. Analysts forecast that growth for the third quarter will fall between 4.6 percent and 4.8 percent.
**Early Release of Investment Plans for Next Year**
On the investment side, the issuance of ultra-long special treasury bonds will continue into next year, with investment areas being optimized to align with major national strategies and enhance security capacities in critical sectors.
Investment projects valued at 200 billion yuan that are planned for next year will be announced this year to assist local governments in expediting preliminary work and construction efforts.
A portion of these projects will focus on urban renewal, primarily involving the development of infrastructure for gas, water, sewage, and heating systems, which is anticipated to generate approximately 4 trillion yuan in investment demand over the next five years.
**Accelerating Local Projects**
This year, a total of 3.12 trillion yuan in special-purpose bonds for local governments has been allocated for project development. By the end of September, 2.83 trillion yuan had been issued, leaving 290 billion yuan remaining.
Local governments are being encouraged to complete the issuance process before November. The upcoming steps will aim to maximize the impact of these special bonds, ensuring that funded projects commence as soon as possible.
Furthermore, the National Development and Reform Commission and the Ministry of Finance are exploring new measures to enhance the management of these bonds.
**Boosting Domestic Consumption Support**
The government is increasing its support for large-scale upgrades across various appliances and initiatives for trading in old products for new ones. These efforts are designed not only to stimulate demand but also to support energy conservation, reduce carbon emissions, and facilitate a broader green transition.
Currently, comprehensive implementation guidelines for the trade-in of consumer goods have been issued, funding is fully allocated, and policies have been implemented.
These initiatives have resulted in a significant rebound in passenger car retail sales and a recovery in home appliance sales. There is a pressing need to intensify the execution of relevant policies to sustain growth in commodity consumption.
**No Tolerance for Unlawful Business Enforcement**
The actions of administrative authorities with respect to businesses will be more closely regulated, emphasizing the adoption of inclusive, cautious, and flexible enforcement strategies. Efforts will be made to prevent unlawful cross-regional enforcement, profit-driven enforcement, arbitrary fines, excessive inspections, and unfounded seizures. Regions exhibiting unusual increases in forfeiture income will be alerted, and inspections may be conducted as necessary.
Debra A Smith for TROIB News
