Key takeaways from China's incremental pro-growth policies

Senior Chinese officials on Tuesday briefed the media on what the government plans to do to further boost the economy on the back of a series of new stimulus measures that have rallied the stock market to record highs.

Here are the key takeaways from the presser, held two weeks after China's top leadership met to set out the country's economic working plan.

Confidence in achieving 2024 growth target

Officials are confident about achieving China's growth target for 2024, with the market sentiment having recently improved. This was backed up by a rapid rebound of the purchasing managers' index (PMI) for China's manufacturing sector, a surge in the stock market and a robust consumption market during the National Day holiday.

China's economy grew by 5 percent in the first half of this year, laying a foundation for the annual target of around 5 percent. The overall economy remained stable in July and August, with some economic indicators showing fluctuations. Market institutions predict that the growth rate in the third quarter will be approximately between 4.6 percent and 4.8 percent.

Some investment plans for next year to be released in advance

On the investment front, ultra-long special treasury bonds will continue to be issued next year with optimized investment areas to implement major national strategies and build up security capacity in key areas.

Investment projects worth 200 billion yuan ($14.14 billion) that are in next year's plans will be released in advance this year to support local governments in accelerating the preliminary work and construction.

A certain proportion of these projects will involve urban renewal, mainly in the construction of pipelines for gas, water, sewage and heating, which is expected to generate investment demand of around 4 trillion yuan in the coming five years.

Head start for local projects

This year, 3.12 trillion yuan of special-purpose bonds for local governments have been allocated for project construction. By the end of September, 2.83 trillion yuan had been issued, with 290 billion yuan remaining. 

Local governments are currently being urged to complete the issuance before November. The next step is to fully utilize and maximize the benefits of the special bonds, ensuring that projects funded by these bonds start as soon as possible and that the bonds have a real impact. 

Meanwhile, the National Development and Reform Commission and the Ministry of Finance are studying new measures to optimize and improve the management of these bonds.

Lifting support for domestic consumption

The government is stepping up its support for large-scale upgrades of various appliances and programs for trading in old products for new ones, which not only help unleash demand potential but also promote energy conservation, carbon reduction and a comprehensive green transition. 

Currently, detailed implementation guidelines for the trade-in of consumer goods have been fully released, funding has been fully allocated, and policies have been fully launched. 

As a result of these measures, passenger car retail sales have rebounded significantly, and home appliance sales have shifted from decline to growth. Efforts need to be intensified to implement relevant policies, driving a sustained increase in commodity consumption.

Unlawful enforcement on businesses is a no

The conduct of administrative authorities in relation to businesses will be further regulated, with a focus on adopting more inclusive, prudent and flexible enforcement approaches. Unlawful cross-regional enforcement, profit-driven enforcement, arbitrary fines, excessive inspections and unjustified seizures must be avoided. Any region experiencing abnormal growth in forfeiture income will be reminded, and inspections will be conducted if necessary.