China’s leaders stick to pro-growth stance, vow support
Add BT as a preferred source
CHINESE leaders said the country’s economic recovery needs continued “forceful” fiscal and monetary support, warning that domestic demand is still insufficient.
The Communist Party’s Politburo, the top decision-making body led by President Xi Jinping, painted a cautiously optimistic view of the economy at a meeting on Friday (Apr 28), according to a statement published by the official Xinhua News Agency.
While growth has been better than expected, the economy is still in a recovery phase and faces new challenges, it said.
China’s economy expanded at its fastest pace in a year in the first quarter, fuelled by stronger consumer spending and government investment in infrastructure. Several economists have upgraded their growth forecasts for the year, although there’s still caution on the outlook, given relatively high unemployment and a slowdown in the global economy.
“Policymakers acknowledged that demand remains weak and needs further support,” Michelle Lam, Greater China economist at Societe Generale “They struck a pro-growth stance and reiterated support to the private sector and commitment to open up.”
Fiscal policy will be “more forceful” while monetary policy will be “targeted and forceful” the Politburo meeting decided, slogans unchanged from the leadership’s last major economic meeting in December after coronavirus restrictions were suddenly relaxed.
Navigate Asia in
a new global order
Get the insights delivered to your inbox.
Chinese stocks advanced on Friday as the reiterated support from top leaders boosted sentiment. The benchmark CSI 300 Index closed 1 per cent higher, the biggest gain in about two weeks, led by telecom and energy sectors.
The meeting also stepped-up rhetorical support for the private sector, vowing to “eliminate any legal, regulatory or hidden barriers preventing the fair competition and common development” of companies, to lift confidence and encourage private companies to invest.
The meeting also vowed to support Internet companies to innovate, and said measures should be taken to support household consumption.
The Politburo also vowed to strictly control local government debt and deepen reforms and resolve risks at smaller banks and insurers. BLOOMBERG
Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter. Delivered to your inbox. Free.
Share with us your feedback on BT's products and services
