China’s Politburo, the top decision-making body of the Communist Party, has endorsed a strategy to boost the economy by increasing consumer spending and eliminating inefficient companies. It warned of challenges ahead, possibly related to global uncertainties before the U.S. presidential election.
Key measures include restoring financial market confidence and increasing government spending. The central bank has lowered interest rates, and the government has doubled subsidies for electric vehicles to drive growth and reduce reliance on fossil fuels.
The focus is on boosting low- and middle-income spending, though details are sparse. Policies encourage replacing old cars and appliances to improve efficiency and cut pollution.
China’s economy grew at 4.7 per cent last quarter, but analysts highlight long-term weaknesses needing reform. Under Xi Jinping, the focus has been on advanced technologies like electric vehicles and renewable energy, creating oversupply issues in sectors such as solar panels.
The Politburo supports fast-growing and high-tech start-ups and aims to address the property sector crisis by promoting affordable housing and adjusting monetary policy to spur investment. Additional support is planned for rural areas to prevent poverty.