SwedCham China Insights for the Week of July 24 - July 28 , 2023

Top news of the week:

China's State Council stresses need for efforts in flood, drought relief work

July 24, 2023

China's State Council stressed efforts in flood prevention and drought relief at an executive meeting chaired by Premier Li Qiang. It also deliberated and adopted a guideline on advancing the transformation of villages in super-large and mega cities, as well as a draft regulation on social insurance management.

China puts forward new measures to spur private investment

July 25, 2023

China's top economic planner has identified several key sectors to stimulate private investment as part of the country's renewed efforts to bolster private sector growth. The National Development and Reform Commission (NDRC) said in a notice it was targeting areas including transportation, water conservancy, clean energy, new infrastructure, advanced manufacturing, and modern agriculture.

China's top legislature holds session, foreign minister, central bank governor appointed

July 26, 2023

China's top legislature National People’s Congress’s Standing Committee voted to appoint Wang Yi as foreign minister and Pan Gongsheng as central bank governor, as it convened a session on July 25. Qin Gang was removed from the post of foreign minister he concurrently held; Yi Gang was removed from the post of governor of the People's Bank of China.

Premier Li Qiang urges efforts to implement strategy to upgrade pilot free trade zones

July 27, 2023

Premier Li Qiang has urged efforts to implement the strategy of upgrading pilot free trade zones (FTZs) and actively conduct new explorations of high-level opening-up to make new breakthroughs and accumulate new experience. Li made the remarks when investigating the construction of pilot FTZs in east China's Shanghai on July 26 and 27.

China’s housing minister urges efforts to strengthen property recovery

July 28, 2023

The Ministry of Housing and Urban-Rural Development said that further property easing measures will be introduced, including lowering the down payment ratio and mortgage rates for first-time homebuyers and allowing tax rebates for home upgrades.

Insight of the week:

The Political Bureau of the Communist Party of China (CPC) Central Committee on July 24 held a meeting to analyze the current economic situation and make arrangements for economic work in the second half of the year. The world's second-largest economy grew at a frail pace in the second quarter as demand weakened at home and abroad, raising pressure on policymakers to deliver more stimulus to shore up post-COVID recovery.

According to the meeting, it is necessary to give full play to the role of quantitative and structural monetary tools. Strong support will be given to scientific and technological innovation, the real economy, and the development of micro, small and medium-sized enterprises. The RMB exchange rate shall be kept generally stable at an appropriate and balanced level, the meeting noted, pledging efforts to invigorate the capital market and boost investor confidence. China will actively expand domestic demand, boosting residents' incomes to enable consumption to drive economic growth, while speeding up local special bond issuance to spur investment, the meeting said. Specifically, it vowed to boost demands on automobiles, electronics, and home furnishing, and promote the consumption of services such as sports, leisure, and cultural tourism. China will improve the development environment for private firms and stabilize trade and foreign investment. Moreover, a number of international flights will be further increased.

The meeting called for concrete efforts in preventing and defusing risks in key areas. China will adjust and optimize property policies in a timely manner, in response to "significant changes" in the supply and demand relationship in the property market, it said. It stressed that stabilizing employment should be considered from a strategic and overall perspective and that the scale of the middle-income group should be expanded.