China to expand domestic demand to ensure speedy recovery & stable growth

China aims to boost domestic demand to expedite economic recovery and foster stable growth, according to an interim report on China’s 14th five-year plan published by parliament on Wednesday. During a meeting on Tuesday Zheng Shanjie, the head of China’s state economic planning body, emphasised the priority on restoring and expanding consumption, stabilising bulk consumption, and promoting services consumption. The industrial profits in China for November recorded double-digit increases, driven by improvements in overall manufacturing. However, subdued demand continues to limit business growth expectations, prompting calls for additional macro policy support. The 29.5% profit rise came on top of a 2.7% increase in October and alongside a pickup in industrial output in November, although other sectors of the world’s second-largest economy still missed forecasts. In the first 11 months of 2023, industrial earnings shrank 4.4% from a year earlier, further narrowing from a 7.8% decline in January to October, National Bureau of Statistics (NBS) data showed on Wednesday. China will also accelerate reforms aimed at expanding the country’s middle-income bracket, Zheng said. The government has in recent months unveiled a series of measures to shore up a feeble post-pandemic economic recovery, held back by a property slump, local government debt risks and slow global growth. China will deepen its market-oriented reforms and institutional opening up to boost development, according to Zheng. The country will also prevent and resolve risks in key areas……" co-ordinate the resolution of risks in real estate, local government debt, and small and medium-sized financial institutions." Zheng also said China needs to step up its development of high technology to overcome a blockade on technology exports imposed by some countries. “(China) must accelerate breakthroughs in key core technologies, achieve a high level of scientific and technological self-reliance, and avoid technologies and industries being ’locked’ in the low-end and middle-end.” With inputs from agencies.