SwedCham China Insights for the Week of December 11 - December 15 , 2023

Top news of the week:

China’s CPI down 0.5% in November

December 11, 2023

China’s consumer price index (CPI), a main gauge of inflation, edged down 0.5 percent year on year in November, official data showed.

China issues measures to boost integrated development of domestic, foreign trade

December 12, 2023

China’s State Council, the cabinet, revealed more than a dozen measures to accelerate integrated development of domestic and foreign trade, aiming to remove regulatory and other barriers to make it easy for companies to explore both the domestic and international markets.

China holds Central Economic Work Conference

December 13, 2023

The annual Central Economic Work Conference was held in Beijing from December 11 to December 12 as Chinese leaders decided priorities for the economic work in 2024. President Xi Jinping delivered an important speech at the conference.

China to be world’s largest aviation services market by 2042: Airbus

December 14, 2023

China will become the world’s largest aviation services market by 2042, with its market value climbing to US$54.1 billion, Airbus China forecast. China is set to overtake Europe and North America to top the global market for aviation services, as the country’s in-service commercial aircraft fleet is expected to grow to 10,930 by 2042, according to the Airbus aviation services forecast for the Chinese market.

President Xi pays state visit to Vietnam

December 15, 2023

Chinese President Xi Jinping's paid a state visit to Vietnam from December 12 to 13. During his visit, President Xi announced the decision to build a China-Vietnam community with a shared future that carries strategic significance, ushering in a new stage and injecting new impetus into China-Vietnam relations.

Insight of the week:

In the annual Central Economic Work Conference held in Beijing, Chinese leaders outlined priorities for economic work in 2024. Party General Secretary Xi Jinping set the tone for economic works of 2024, “we must persist in seeking growth while maintaining stability, facilitating stability through growth, and building the new before breaking the old.”

The meeting stands at a critical juncture in its efforts to consolidate the nation’s economic recovery, revive business confidence and bolster new sectors, including the digital economy, to power economic growth over the long run. Experts and analysts see differently of what may come out from the meeting. Some challenges that no hint of large-scale stimulus policies for consumption and lack of detailed discussion on increasing household income and remain uncertain about China’s goal of 5% plus GDP growth. While the others see positively after the conference, uplifting China’s GDP growth prediction, including the World Bank and the Asia Development Bank.

The focus of the Conference is on policy measures to address these issues, emphasizing stability and progress, introducing policies to stabilize expectations, growth, and employment, promoting innovation, and adjusting growth models. The meeting advocates for counter-cyclical adjustments, fiscal and monetary policies, expanding special local government bonds, and supporting scientific and technological innovation.

Key priorities include sci-tech innovation, expanding domestic demand, deepening reforms, high-standard opening up, preventing and defusing risks, advancing ecological conservation, and ensuring people's livelihoods. The emphasis is on a unified national market, easing market access, and aligning with global trade rules. The meeting underscores the need for Party leadership, consistent macroeconomic policy, and measures to address specific challenges such as real estate risks and local government debt.

Calling for continuing to build a market-oriented, legal and international business environment, the Conference specifically stressed the need to effectively remove the obstacles for foreigners to come to China for business, study, and tourism, and do a good job in implementing the eight steps to support high-quality Belt and Road cooperation.

Regarding the real estate sector, the Conference reiterated that China will speed up the construction of a new model of development, and coordinate the resolution of local debt risks and stable development. Efforts must be made to actively and steadily resolve real estate risks, and meet the reasonable financing needs of different real estate enterprises, aiming to promote the stable and healthy development of the real estate market, said the meeting.