Boosting domestic demand and promoting consumption: Key tasks of China's economy in 2025

Editor's note: Liu Chunsheng, a special commentator on current affairs for CGTN, is an associate professor at the Beijing-based Central University of Finance and Economics. The article reflects the author's opinions and not necessarily the views of CGTN.

China's Central Economic Work Conference has set the direction for economic work in 2025, with a strong emphasis on boosting consumption as a key task. This decision not only focuses on the current stability and recovery of the economy but also holds profound strategic significance. It aims to comprehensively expand domestic demand, laying a solid foundation for the sustained and healthy development of China's economy.

The importance of boosting consumption for China's economy is self-evident. As the leading driver of economic growth, consumption has become increasingly crucial amid the complex and volatile international economic situation. In recent years, global economic growth has been sluggish, trade protectionism has risen and exports have faced many uncertainties. Meanwhile, as the domestic economic structure adjusts, the investment-driven growth model has gradually encountered bottlenecks. Against this backdrop, consumption has become a key force in stabilizing economic growth. From the perspective of the domestic market, the large population base inherently contains enormous consumption potential. Unlocking this potential can effectively resist external economic fluctuations and achieve autonomous and stable economic growth.

China's consumer market has undergone significant changes over the past few decades. From traditional subsistence consumption to today's diversified and personalized quality consumption, the consumption structure has continuously upgraded. Nowadays, emerging areas of consumption such as service consumption and cultural tourism have developed vigorously, becoming new highlights of the consumer market. For example, in recent years, the domestic tourism market has continued to heat up, with major tourist attractions crowded during holidays and tourism revenue reaching new highs. This has not only driven the coordinated development of related industries such as transportation, catering and accommodation but also injected strong vitality into the local economy. Meanwhile, with the popularization of internet technology, the rise of new types of consumption such as online shopping and mobile payment has further broadened consumption channels and unleashed consumption potential. According to statistics, the transaction volume of e-commerce platforms during the annual "Double Eleven" (Nov.11)  online shopping festival showed explosive growth, fully demonstrating the strong resilience and vitality of China's consumer market.

To achieve the goal of significantly boosting consumption, a series of strategic measures are being steadily implemented. In terms of increasing income and reducing burdens for the middle- and low-income groups, the government will take multidimensional measures. Appropriately raising the basic pension for retirees, the basic pension for urban and rural residents, and the financial subsidy standard for medical insurance for urban and rural residents will directly increase residents' disposable income and reduce their living burdens, thereby enhancing their consumption capacity. For example, the increase in pensions will allow retired elderly people to have more funds for cultural entertainment, health care and other consumption areas beyond meeting basic living needs, thereby driving the development of related industries.

In terms of innovating consumption scenarios, efforts are being intensified to expand the implementation of the equipment upgrading policy and consumer goods trade-in programs, actively developing diversified consumption patterns such as the debut economy, winter sports economy and silver economy. Taking the "debut economy" as an example, major cities are building platforms to attract new product debuts from well-known domestic and international brands. This will not only satisfy consumers' pursuit of fashionable and high-end products but also enhance the cities' commercial influence and consumer attraction. The winter sports economy, leveraging the legacy of the Beijing 2022 Winter Olympics, has vigorously developed winter tourism, winter sports and related industries in northern regions, driving the coordinated development of upstream and downstream industries such as winter sports equipment manufacturing and winter sports venue construction. The silver economy has focused on the consumption needs of the elderly population, developing specialized products and services such as elderly tourism, healthcare and finance, providing the elderly with a richer variety of consumption options. 

In promoting the development of the cultural tourism industry, policy support and guidance have been strengthened, tapping into the rich cultural and tourism resources of various regions to create distinctive cultural tourism brands. By organizing various cultural and tourism events, the popularity and reputation of tourist attractions have been enhanced, attracting more visitors for sightseeing and tourism. For example, Yunnan's ethnic cultural tourism and Xi'an's historical cultural tourism have become pillar industries in their respective regions, driving the prosperous development of the local economy. Besides traditional policy support and resource exploration, innovation and breakthroughs in cultural products have also injected new vitality into the industry. The success of video game Black Myth: Wukong is a typical example. On August 20, 2024, Black Myth: Wukong was launched globally, quickly attracting worldwide attention. On December 13, at the The Game Awards 2024 ceremony held in Los Angeles, US, Black Myth: Wukong won two major awards, namely: the Best Action Game of the Year and Gamer's Voice. The awards not only recognized its quality but also significantly enhanced the influence of Chinese culture, inevitably leading to a notable increase in game consumption. The game has also noticeably driven cultural tourism consumption; 27 out of the 36 filming locations are in Shanxi, which have seen a significant increase in tourism heat and ticket orders. Shanxi's culture and tourism authorities have launched a "Follow Wukong to Tour Shanxi" campaign, releasing themed routes and distributing peripheral products.

Looking ahead, with deepening implementation of these policy measures, China's consumer market is expected to usher in a even more prosperous situation. The consumption structure will further be optimized and upgraded, and emerging areas of consumption will continue to develop vigorously, becoming a new engine of economic growth. At the same time, the prosperity of the consumer market will drive the coordinated development of related industries, promote employment growth and form a virtuous cycle of economic development. On the international stage, China's large and active consumer market will attract more global high-quality resources, further enhancing the country's position in the global economic landscape. 

Boosting consumption is one of the core tasks of China's economic work in 2025, holding profound strategic significance and broad development prospects. Through implementing a series of precise and effective strategic measures, China's economy is expected to achieve steady growth amidst the wave of consumption upgrading, moving towards a higher-quality development stage.

(Cover via CFP)