China’s top economic planning agency said it will make stabilizing the economy a higher priority as it expects hard work will be needed to sustain growth in the remainder of the year.
Recent COVID outbreaks in the country and the “complicated international environment” mean that “arduous efforts” will be needed to ensure economic growth stays on track in the fourth quarter, said Meng Wei, spokeswoman of the National Development and Reform Commission (NRDC). “Stabilizing growth will be put in an even more important position,” she said November 15 at a regular monthly briefing.
China’s economic activity weakened in October, with consumption contracting for the first time since May, laying bare the damage from COVID lockdowns and restrictions, and the shrinking housing market. The slowdown has put pressure on Beijing to ramp up support, with the government introducing major changes in the past week to reduce the drag on consumers from COVID Zero policies and rein in the property slump.
Refining COVID controls will facilitate the smooth operation of the economy and help market demand to recover, Meng said. The foundation of economic recovery will become more solid and it’s possible the growth will pick up, she added.
A total of 740 billion yuan ($104 billion) raised through policy bank financing tools has all been invested and construction on most of the projects that received money has started, Meng said. The tools played an “active role” in stabilizing investment by maintaining spending on infrastructure in the face of the plunge in real-estate investment, she said.
The money was invested in projects such as a high-speed rail link between Beijing, Xiong’an in Hebei province and Shangqiu in Henan province, water conservation projects, solar, wind and nuclear power plants, and gas supply and drainage systems in urban areas, she said.
Going forward, the NDRC will push for the acceleration of construction on the projects to expand effective investment. It also aims to speed up the recovery of consumption in key areas, enhance support for small businesses, and ensure the supply of goods that are directly related to people’s livelihood such as pork or energy, she said.
Separately, the NDRC approved eight fixed-asset investment projects last month in the high tech and water conservation sectors, with a total investment of 9 billion yuan, she said. That took the total number of projects approved in the first 10 months of the year to 97, with investment involved exceeding 1.4 trillion yuan.
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