The State Council Executive Meeting chaired by Premier Li Chang... “Efforts to achieve annual growth target”

State Council Premier Li Chang, 'China's second-in-command', ordered that ahead of the start of the fourth quarter of this year, efforts should be made to revitalize the economy by expanding lending and boosting domestic demand.

According to Xinhua News Agency on the 28th, Premier Li presided over the State Council Executive Meeting and studied work related to improving the effectiveness of macro policies and promoting effective investment.

The meeting emphasized, "We must strive to increase the intensity of macro policy counter-cyclical adjustment to problems that appear in the current economic operation, promote continuous innovation and improvement of the economy, and achieve the annual economic development goal."

Counter-cycle control refers to operating policies in opposition to the economic flow to promote stable economic growth. During an economic downturn, easing policies, such as lowering interest rates, are implemented, and austerity policies are applied when the economy overheats. In China's current economic downturn, this means increasing the scale of stimulus policies.

China has set an economic growth target of '4.5-5%' this year. The first quarter started with a growth rate of 5.0%, but fell to 4.3% in the second quarter. The growth rate in the second quarter is also the lowest since the fourth quarter of 2022 (2.9%), when the Chinese economy was shocked by the spread of COVID-19.

Exports and industrial production continue to boom, but domestic demand, investment, and real estate stagnation continues.

Retail sales in August increased only 0.4% compared to the previous year, falling below market expectations, and fixed asset investment from January to August decreased 7.2% compared to the previous year, showing the steepest decline since April 2020.

On this day, the State Council Executive Meeting called for increasing the speed and efficiency of implementing various policies announced so far, accelerating the issuance and use of bonds, quickly starting construction of major infrastructure projects, and strengthening interest support policies to expand investment and promote consumption.

In addition, optimizing fiscal expenditure plans, appropriate use of local government debt balance limits, and comprehensive operation and timely adjustment of monetary policy instruments were presented as tasks. It was also mentioned that policy research is needed to promote scientific and technological innovation and technological reform, increase re-loan limits to support rural areas and small businesses, and stabilize the real estate market and promote employment.

The meeting on this day said, “We must revitalize private investment and increase the efficiency of investment approvals,” and “We must continue to research and stockpile policy measures to stimulate domestic demand, explore more work plans with a large impact, and encourage localities that meet the conditions to implement them first.”