Results of the Political Bureau meeting to develop plans for the Chinese economy

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Editor’s Note: Liu Chunsheng is an associate professor at Beijing Central University of Finance and Economics. The article reflects the views of the author and not necessarily those of the CGTN.

The Political Bureau of the Communist Party of China (CPC) Central Committee held a meeting on July 30 to develop plans for the Chinese economy in the second half of the year.

According to statistics released by the government, China’s GDP growth rate reached 12.7% in the first half of the year, which is the world’s leading economic recovery. The Politburo meeting analyzed economic performance, set goals and developed a comprehensive plan for China in both the short and long term. It was seen as a key meeting at a critical time and sent a strong signal of full support for economic recovery and development.

The global COVID-19 pandemic continues to evolve, and the recent outbreak in Nanjing and other cities has shown that the situation is complex and that preventing the pandemic poses great challenges. The meeting stressed that the external environment was full of uncertainties and that China’s economic recovery was under pressure. Friction between China and the United States has also intensified.

According to data released by the National Bureau of Statistics, the Chinese Manufacturing Purchasing Managers’ Index in July was 50.4 percent, down 0.5 percent from last month’s, although it is still at above the expansion line. The new export orders index hit a new low since July 2021, reflecting weaker external demand. Meanwhile, the price of the bulk commodity index remained at a high level.

Therefore, it was necessary to maintain the continuity, stability and sustainability of macroeconomic policies and to keep the economic functioning within a reasonable range. In the second half of the year, the effectiveness of proactive fiscal policy should be improved and special attention should be paid to the impact of the pandemic. In addition, a prudent monetary policy should maintain reasonable and sufficient liquidity and help small and medium-sized enterprises and difficult industries.

China will continue to support advanced scientific and technological autonomy and promote high-quality development by strengthening reforms and opening up, further boosting the vitality of the domestic market, optimizing the business environment and enhancing resilience. China’s economy.

The meeting called for harnessing the potential of the internal market and accelerating the development of new energy vehicles, which will undoubtedly benefit the industries and businesses concerned. More favorable policies are expected, and the market outlook for new energy vehicles will become more promising. In the second half of the year, China is expected to promote research on key technologies, encourage the development and innovation of vehicle operating systems and batteries, and stimulate the deep integration of new energy vehicle industries with transport, information and communication industries.

On the other hand, it is vital to strengthen infrastructure development and accelerate the construction of highway pricing networks in urban and rural areas. In 2021, many regions have successively implemented support policies to promote the consumption of new energy vehicles by granting purchase subsidies and optimizing infrastructure. In addition, the data shows that the major New Energy Vehicle (NEV) markets around the world are growing rapidly. With a combination of policies put in place by central and local governments, the Chinese NEV market will have a bright future.

An electric vehicle charges at a charging station in China. / CFP

An electric vehicle charges at a charging station in China. / CFP

The meeting stressed that great attention should be paid to financial risks and the stability of the real estate market. For the very first time, the Politburo spoke about improving the listing system for overseas companies. Chinese private sector companies, especially internet giants, have been rushing to be listed on the US stock markets in recent decades, prompting many concerns about the risks of national security and leakage of data. information frequently highlighted by Chinese authorities in recent years. Subsequently, the US Securities and Exchange Commission (SEC) may become more concerned about the unexpected impact of Chinese policy on investor interest. There is a need for a more coordinated system for listing Chinese companies abroad.

As with real estate, housing should be used for living, not for speculation. This means that the strict monitoring of the real estate sector will continue and be more targeted. It is important to adhere to the basic thinking, to deal with the relationship between economic recovery and risk prevention, and to establish and improve the market-oriented and law-based mechanism.

The meeting also addressed people’s concerns about employment, family planning policy, and production security. The meeting highlighted the employment of university graduates and migrant workers and the need to improve the protection of workers’ rights and interests for flexible employees.

And as the three-child policy was implemented, the meeting focused on improving child care, parenting, education and other supportive policies, which will be conducive to to improve the will to have children and to promote the sustainable development of the population, economy and society. .

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