China Takes Actions to Boost Consumption

China Takes Actions to Boost Consumption

With the gradual abatement of the COVID-19 epidemic， the main tasks in China have changed to restoring normal production and routine life， promoting consumption， and maintaining steady economic growth.

Since March， a variety of policies have been introduced in succession to stimulate consumption. Recently， the central and local governments at all levels once again emphasized that promoting consumption is the priority of their work.

On March 13， 23 ministry-level departments including the National Development and Reform Commission jointly issued a document for promoting consumption. For the first time， the creation of a consumption ecosystem based on intelligent technologies was proposed to boost green， intelligent， and online consumption.

In addition， the Political Bureau of the Communist Party of China（CPC） Central Committee stressed in a recent meeting that China should speed up efforts to unleash domestic consumption potential， expand household consumption， increase public consumption at a reasonable level， start spending in brick-and-mortar stores， and keep online consumption active. The Ministry of Commerce also said that it would further restore the circulation of goods and business orders， and introduce more measures to promote consumption of products like automobile.

Final Battle Against Poverty in 2020

According to a recent press conference by the State Councils mechanism for joint prevention and control of novel coronavirus， in order to win the battle against poverty across China by the end of 2020， competent departments had rolled out a raft of measures to eradicate poverty by boosting businesses， consumption， and employment as well as strengthening support to vulnerable groups.

Wang Chunyan from the State Council Leading Group Office of Poverty Alleviation and Development said that epidemic prevention and control in poor areas had shown positive results.

The epidemic mainly affected poor areas in the following three ways. First， it prevented the poor from leaving home for their jobs in urban areas. Second， it increased the difficulties faced by farmers in production and work. Third， it delayed many poverty alleviation projects. To mitigate the impacts， the poverty relief office and other departments jointly issued a series of policy documents， pledging financial， employment， and other policy support.

These policies are being implemented step by step and have achieved good results.

More poverty alleviation projects had resumed. In 22 provincial-level regions in central and western China， out of 370，000 projects， 220，000 had been back in construction. Businesses and plants for poverty reduction had also reopened in areas at low risk of spreading the virus.

Measures to Help Migrant Workers Secure Jobs Near Their Homes

The Ministry of Agriculture and Rural Affairs and the Ministry of Human Resources and Social Security have jointly issued a guideline for helping migrant workers to locate jobs in their hometown and nearby urban areas.

The guideline called for strengthening policy support and guidance to support migrant workers to find jobs near their area of residence. According to it， supportive fiscal， taxation， credit， and other policies will be put in place for the purpose. The country will give subsidies to those who return to their hometowns to start a business or who have run a business for more than a year. It also pledged loans with discounted interest rates to startups.

The guideline also encouraged enterprises to create more jobs and come up with flexible employment models including providing seasonal and temporary jobs to migrant workers.

In addition， China will develop new forms of business. It will actively develop production services， primary processing of agricultural products， tourism， and consumer services， and attract migrant workers to work in agricultural fields.

Stronger Macro Policies Pledged to Offset Economic Impact of COVID-19

To lower lending costs and offset the economic shock of the COVID-19 epidemic， Chinas central bank has recently pumped liquidity into the market through seven-day reverse repos while cutting its interest rate by 20 basis points.

The rate cut has echoed arrangements made at a meeting of the Political Bureau of the CPC Central Committee that a prudent monetary policy should be pursued with more moderate flexibility.

A package of macro policies and measures will be introduced， the meeting noted， and China will appropriately raise the fiscal deficit ratio， issue special treasury bonds， increase the scale of special bonds for local governments， and guide the interest rate to decline in the loan market，

Amid the countrys efforts to contain the COVID-19 epidemic， expenditure on health saw doubledigit growth， and spending on social security and employment also logged a 2.5-percent expansion from the same period last year.

As critical measures to cope with the epidemic and restore economic growth， a series of monetary policies have been rolled out by the government since the COVID-19 outbreak to step up a countercyclical adjustment.