China Launches Action Plan to Enhance Domestic Consumption
China’s State Council announced an action plan on Sunday to enhance domestic consumption by boosting resident incomes and implementing a childcare subsidy scheme. This initiative addresses weakened domestic demand, influenced by COVID-19 and property market challenges, and aims to stabilize the stock market to encourage investment.
On Sunday, China’s State Council revealed a strategic action plan aimed at enhancing domestic consumption. This initiative includes increasing residents’ income and establishing a childcare subsidy program. The announcement followed Premier Li Qiang’s recent work report to the National People’s Congress, which emphasized the importance of bolstering household spending in light of weak external demand that has been affecting the economy.
The underlying reasons for the decline in domestic demand over recent years include disruptions stemming from COVID-19 and a prolonged slump in the property market. The newly launched action plan emphasizes the need to increase incomes for both urban and rural residents to stimulate economic activity. Furthermore, it calls for measures to stabilize the stock market, although specific details regarding the timing and implementation of these measures have not yet been disclosed.
In addition to increasing incomes, the plan seeks to expand property income channels. This will involve efforts to stabilize the stock market while also developing a range of bond products that are more accessible to individual investors, thereby encouraging greater participation in the market and stimulating consumption.
The action plan presented by China’s State Council marks a significant step towards revitalizing domestic consumption through income support and initiatives aimed at enhancing market stability. By targeting both urban and rural income increases, alongside encouraging investments through the stock market and bond products, China aims to mitigate the effects of weakened demand and foster economic resilience.
Original Source: www.tradingview.com
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