China has laid out ambitious economic plans for 2025, focusing on adopting more proactive fiscal policies, implementing moderately accommodative monetary policies, and expanding domestic demand across the board. These decisions were made during the annual Central Economic Work Conference held recently in Beijing.
More Proactive Fiscal Policy
The conference emphasized the need for a more proactive fiscal policy in the coming year. But what does this mean? According to Yang Zhiyong, head of the Chinese Academy of Fiscal Sciences, it involves making full use of China’s fiscal policy space. By increasing the deficit-to-GDP ratio, the government can raise more funds to promote consumption and investment, ultimately stimulating economic growth.
“This approach will provide stronger policy support,” Yang explained. “It will help expand domestic demand by promoting consumption and investment.”
Experts believe that this move signals stronger policy support in the year ahead, demonstrating the continuity and stability of fiscal policy.
Moderately Accommodative Monetary Policy
In addition to fiscal measures, China plans to implement a moderately accommodative monetary policy. Dong Ximiao, chief researcher at the Merchants Union Consumer Finance Company Limited, noted that this decision sends a positive and clear signal, boosting confidence and stabilizing market expectations.
“A supportive monetary policy stance will continue to reduce the financing costs for enterprises and residents,” Dong said. “It will ensure ample liquidity and maintain low interest rates.”
This approach is expected to open doors for more investment in areas like technological innovation, green development, and consumer finance, stimulating innovation and economic vitality.
Expanding Domestic Demand
One of the key tasks identified for 2025 is expanding domestic demand on all fronts. The conference called for a special campaign dedicated to stimulating consumption, with efforts to increase incomes and alleviate burdens on low- and middle-income groups.
Liu Yuanchun, president of the Shanghai University of Finance and Economics, believes this campaign could be especially impactful. “In the past, we didn’t have such a unified national effort to expand consumption,” Liu said. “This proposal means more efforts and policy tools will be used to boost consumption.”
The plans include promoting large-scale equipment upgrades, consumer goods trade-in programs, and developing new economic drivers like the “debut economy,” “ice and snow economy,” and “silver economy.”
Conclusion
China’s bold economic plans for 2025 aim to strengthen its economy by adopting proactive fiscal policies, accommodating monetary policies, and expanding domestic demand. These measures are expected to boost consumption, stimulate investment, and promote sustainable growth, setting the stage for a dynamic economic landscape in the coming year.
Reference(s):
cgtn.com
