How will China get its consumers spending in 2023?
After one of the worst economic performances on record in 2022 with 3% gdp growth, it’s now all hands on deck in a bid to revive the world’s second-largest economy. Qing na from dao insights explores what kind of economic policies the chinese government is putting in place post-pandemic.
This ambition was reiterated by Guo Tingting, Vice Minister of Commerce, at the first press conference of the new year hosted by China’s Ministry of Commerce on 2 February. While the strategies presented are yet to be put into action, they quickly created a more optimistic mood, with rating agency Fitch announcing on 8 February that it had revised its China growth forecast to 5% for 2023. This was raised from 4.1% previously, reflecting “the evidence that consumption and activity are recovering faster than initially anticipated” following the country’s sudden reopening in late 2022.
Naming 2023 “The Year of the Consumption Reboot”, Chinese local authorities pinpointed industries that would be at the forefront of driving the domestic economic recovery, including the automotive, home furnishings, household appliances and catering sectors.
Emphasising the priority of new sales of cars of all kinds, Xu Xingfeng, head of the Department of Market Operation and Consumption Promotion at the Ministry of Commerce, also signalled support for incentivising purchases of vehicles powered by renewable energy, as well as improving relevant services such as licence privileges and charging infrastructure for electric vehicles (EVs)
This, to some extent, is expected to offset the pessimism that has emerged in the automobile industry in recent years, especially amongst electric car makers at home, as the government pulled the plug on a more than decade-long subsidy for EV car buyers, which took effect on the first day of 2023.
Read More at https://focus.cbbc.org/how-will-china-get-its-consumers-spending-in-2023/