While China's recent Central Economic Work Conference emphasized the importance of domestic demand and consumption as key drivers of economic growth, there is also significant potential for further investment in the country, according to a key national economic commission.

The Central Commission for Financial and Economic Affairs, which advises the Chinese government on economic and policy decisions, said the country needs a targeted approach focusing on closing existing gaps and boosting long-term growth to improve investment efficiency, according to a question-and-answer transcript published on Monday. 

Key areas for investment include infrastructure, real estate and social welfare, with additional funding aimed at improving education, healthcare and elderly care, according to the commission. In the manufacturing sector, the government plans to increase investment in technological innovation, industrial upgrading and green transformation, the commission said.

The commission also called for a multi-pronged approach to stimulate investment. Strengthening coordination between fiscal and financial policies will be crucial, with the government leveraging major projects to attract further investment. New public-private partnership mechanisms will also be introduced to ensure smooth collaboration between the government and private capital.

Stabilizing policy expectations for private enterprises and boosting their confidence remain top priorities, said the commission, which also emphasized that unlocking the potential of private investment is essential to driving economic growth.

On foreign investment, the commission reaffirmed the government's commitment to expanding institutional openness and ensuring a stable environment for foreign businesses. Efforts will be made to improve the regulatory framework to attract and retain foreign investment.

The commission also stressed the need to streamline decision-making processes and enhance the investment environment. This includes simplifying investment approval procedures and addressing irregularities in investment attraction practices.

The government will also work to reduce transaction costs and increase financing support for small and medium-sized enterprises, ultimately lowering the cost of financing for the broader economy.