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China has announced a plan to revitalize domestic consumption as President Xi Jinping’s government battles to restore poor trust and deflationist pressures in the world’s second largest economy.
The government will “strongly strengthen consumption” and “expand domestic demand in all directions”, according to Xinhua, the state -owned China news agency, echoing XI’s incentive at the end of last year for policymakers to relocate to support after a sustainable push to increase the industry.
The plan from the State Council, China’s cabinet, will focus on income rise, real estate stabilization and stock markets and improvement of medical and pension services, although some details of planned fiscal expenses were available.
The Hang Seng Seng Index of Hong Kong rose 0.8 percent, while the future for Brent Crude, the international oil standard, climbed 0.6 percent to $ 71 per barrel. China’s CSI 300 Index of China in Shanghai- and Shenzhen-Listeed Stocks, which on Friday turned positive for the year, waiting for the consumption conference, slipped 0.2 percent.
The late Sunday plan followed the meeting of the “Two Sessions” in Beijing last week, where lawmakers reorganized consumption as a major advantage.
Internal expenses in China have been poor since the end of Covid-19 blocking more than two years ago as families cared for spending. Consumer prices fell into deflation in February, though reading was affected by the New Year’s lunar holiday.
A slowdown in the wide sector of China’s properties, partially driven by an official deleveriging machine and now in its fourth year, has also re-energy calls from economists to strengthen its domestic demand.
Data issued by the National Bureau of Statistics on Monday showed that retail sales increased 4 percent in January and February a year earlier, beating a 3.7 percent increase in December and in accordance with forecasts from a reuters’ survey.
Last September policymakers discovered a long -awaited package to support the economy, but the measures focused mainly on stock markets.
The new consumer plan includes a promise to raise the minimum wage, strengthen support for education and the creation of a system of childcare subsidies – a pressing issue as China’s population has fallen for three consecutive years.
Lynn Song, including chief economist for the Great China, said the plan decided “a significant focus on increasing the capacity and willingness of households to consume”, and that if applied properly, it can “help China’s economic transition to a consumer -driven growth model”.
Data released on Monday also showed that industrial production increased 5.9 percent per year in the first two months of 2025, slowing from 6.2 percent in December, but beating analysts’ expectations of 5.3 percent.
The new package will also promote “introductory” consumption. Beijing has extended visa -free trip to dozens of places last year in an effort to revive foreign tourism after the pandemic.
He also highlighted special sectors such as “snow and ice”. China has built several internal ski resorts in recent years, including the largest in the world in Shanghai, which opened in September.
Xu Chenggang, a senior research researcher at Stanford University Center for China’s economy and institutions, said the Beijing pivot for consumption betrayed an official recognition that the economic situation is “serious”.
But policymakers were still struggling to take concrete steps to stimulate the demand, he added.
“If we look at published published measures. . . We still don’t see much there in terms of supporting internal demand, “Xu said.” Although on the one hand they admit that something is wrong.. They are still emphasizing more on the side of supply. “
Additional reporting by William Sandlund to Hong Kong
