Editor's note: Imran Khalid, a special commentator on current affairs for CGTN, is a freelance columnist on international affairs. The article reflects the author's opinions and not necessarily the views of CGTN.

China's top economic planning agency, the National Development and Reform Commission (NDRC), announced 20 administrative measures on July 31 in a bid to broaden and to invigorate domestic consumption amidst internal and external economic challenges. These include loosening car purchase restrictions, incentives for first-time home buyers, and encouraging upgrades in housing. The focus also extends to promoting home improvement and stimulating consumption in cultural tourism during holidays.

By stimulating key consumption areas, China aims to steer through economic headwinds and maintain growth momentum. The NDRC measures represent swift policy action to stabilize growth. The support measures are crucial to improving market expectations, increase domestic demand and boost the private economy so as to ensure a steady economic recovery in the second half of 2023. One of the significant aspects of the 20 measures is bolstering consumption in two major segments – houses and cars. Regarding housing, the NDRC has offered support for first-time homebuyers and those seeking improved living standards. It plans to enhance fundamental mechanisms and support policies for housing security, while expanding affordable rental housing availability. In view of the housing challenges faced by new urban residents, youth, and other vulnerable groups, China aims to ease housing difficulties and strengthen the foundation of domestic consumption.

The NDRC's housing industry measures coincide with other efforts from Chinese authorities and local governments to revitalize the real estate market, a vital force in domestic consumption, facing its own set of challenges. Last week's State Council executive meeting emphasized the need for tailored and optimized real estate policies, promoting the stability and health of the market's development. The outline of these measures seek to cut down payment ratios for first-time homebuyers, lowering mortgage rates and easing purchase restrictions for people keen on buying a second house. China's proactive approach underscores its commitment to calibrating policies to suit varying urban demands, fostering a resilient and thriving real estate sector amid economic headwinds.

Vehicle sales is the second largest source of domestic consumption. In support of this vital sector, the NDRC has advised regions from imposing fresh restrictive measures on car purchases, while urging optimization of existing restrictions according to local conditions. Also, policies lifting constraints on second-hand car sales must be diligently carried out. The push for new-energy vehicles has also got a leg up, underscoring China's determination to drive sustainable and eco-friendly mobility solutions to invigorate the auto industry. Official data shows a 9.8 percent year-on-year increase in auto sales, reaching approximately 13.24 million units in the first half of 2023. Notably, sales of new-energy vehicles had an impressive surge of 44.1 percent year-on-year, hitting 37.47 million units in the same period. These figures reflect the uptrend among car buyers.

Policy makers appear to have grasped the crucial role of promoting consumption to sustain ongoing recovery. Prioritizing people's aspirations for an improved life is the main theme of these measures for economic resurgence. By bolstering consumer spending, China seeks to invigorate its economy and build a strong platform for sustained growth and prosperity. Beyond the housing and vehicle sectors, the NDRC's measures span diverse areas, encompassing services consumption and rural spending. They seek to foster innovative consumption models and enhance consumption infrastructure, underlining China's comprehensive approach to invigorate domestic demand.

Amidst challenges in the wider economy, subdued demand, and external intricacies, the need for countercyclical policy adjustments becomes essential. It appears that Chinese policy makers are working hard on bolstering domestic demand and shoring up market confidence.

Experts anticipate a gradual stabilization and improvement in the economy, with a comprehensive package of stimulus policies in the pipeline to maintain recovery. China's proactive approach aims to fortify economic resilience and ensure a steadfast path towards growth in the face of prevailing uncertainties. The crux of restoring and expanding domestic demand lies in promoting consumption, aligning with people's aspirations for an improved life and laying a robust foundation for economic recovery.

As the year progresses, the NDRC measures will certainly expand domestic demand and boost consumption. This will also increase purchasing power and additional incomes through employment promotion that can be channeled to stimulate purchases of major items, enhancing holiday spending etc. China's proactive approach aims to invigorate the economy while catering to the diverse needs of its population.

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