The fourth session of the 14th National People's Congress held a press conference on the economy on Friday.

Top officials from the National Development and Reform Commission (NDRC), the People's Bank of China (PBOC), the Ministry of Finance, the Ministry of Commerce and the China Securities Regulatory Commission (CSRC) outlined the country's economic priorities and signals for the future.

Polices support for high-quality development

China's GDP is expected to grow by over 6 trillion yuan ($869.6 billion) this year, said Zheng Shanjie, head of the NDRC.

This economic expansion will provide solid support for employment, people's well-being and risk prevention, Zheng said.

The size of China's service sector is expected to expand beyond 100 trillion yuan in the 15th Five-Year Plan period (2026-2030), he added.

Zheng said the NDRC will work with other government departments to roll out a number of supportive measures to fully unlock the potential of high-quality development in the service sector.

China will establish a national-level mergers and acquisitions (M&A) fund this year to further smooth exit channels for venture capital investment and improve capital turnover efficiency. The fund is expected to guide and leverage more than 1 trillion yuan ($145 billion) of investment from various sources, Zheng said. 

Forex policy focuses on long-term stability

China has no need or intention to seek competitive edges in foreign trade through the depreciation of its currency, China's central bank governor Pan Gongsheng said at the press conference.

The PBOC has always upheld the decisive role of market forces in exchange rate formation, maintained exchange rate flexibility, strengthened expectation management, and kept the yuan's exchange rate generally stable at an adaptive, balanced level, Pan told the gathered media.

Under certain circumstances, macro-prudential management tools will be employed to curb "herd behavior" and negative self-reinforcing dynamics in the market, he said, citing the recent adjustment in the foreign exchange risk reserve requirement ratio for forward forex sales.

Noting that the factors influencing exchange rates are complex and highly uncertain internationally, Pan said participants in China's foreign exchange market have become more mature, and the market has shown greater resilience.

With more enterprises using exchange rate hedging tools or settling cross-border trade in yuan, over 60% of China's import and export activities are effectively shielded from exchange rate volatility, a figure expected to rise further this year, he revealed.

Fiscal, regulatory measures fuel growth push

China's Finance Minister Lan Fo'an, meanwhile, said at the press conference that China's fiscal fund allocation is expected to reach record highs in terms of total expenditure, the scale of new government bond issuance, and central government transfer payments to local governments.

The country's total fiscal expenditure is projected to surpass 30 trillion yuan for the first time this year, while the scale of new government bond issuance is expected to hit a record high of 11.89 trillion yuan, marking the largest issuance in recent years, Lan said on the sidelines of the fourth session of the 14th National People's Congress.

The total amount of central government transfers to local governments is expected to reach 10.42 trillion yuan this year, he said, adding that the measure will further enhance the financial capacity of local governments.

More funds will be allocated to key areas and critical sectors of high-quality development, Lan said, noting that nearly 1.3 trillion yuan of fiscal funds will be allocated this year to support science and technology development, an increase of 7.1% from the previous year, while combined spending on education, social security, employment, health care and housing is expected to exceed 12.4 trillion yuan.

At the same time, a "more targeted and inclusive" set of listing standards will be added to the ChiNext board in the near future, said Wu Qing, chairman of the China Securities Regulatory Commission. Active support will also be given to high-quality, innovative and entrepreneurial firms operating in new types of consumption and modern services to issue shares on the ChiNext board.

Services and consumption catalyst 

China will promote imports of high-quality consumer services, including medical and health care services, as the country moves to vigorously develop trade in services, Chinese Minister of Commerce Wang Wentao said at the press conference.

China will make good use of visa-free and other policies, expand travel service exports, and tap the export potential of services such as culture, traditional Chinese medicine and catering, he said.

China will also roll out updated policies for departure tax refund this year, Wang added.

(With input from Xinhua; Cover via VCG)