China releases plan to boost household consumption

BEIJING: China releases kit directives aimed at increasing Household consumptionweakness that weighs on growth in the world’s second-largest economy, and the plan covers sectors such as child and senior care and food and beverages.
Leaders including President Xi Jinping pledged last month to provide aid increase domestic consumption and easing pressure on China’s ailing real estate sector after a meeting of top officials from the ruling Communist Party.
The State Council, China’s cabinet, published a list of 20 general directives on its website Saturday evening that provide a broad roadmap for ministries and local governments to revive the economy after stringent pandemic-related measures that had hampered economic growth were lifted in late 2022.
The plan, which does not include proposed budgets, calls on authorities to “increase the provision of care services for older people”, a sector with growth potential in a country with an ageing population.
It also calls for the development of childcare services, as fewer young people are choosing to have children due to the high cost of education and lack of social benefits.
According to the document, income tax cuts are also planned to compensate for the costs of caring for children under three and the elderly.
Beijing also pledged to ensure that eligible small businesses in the service sector can benefit from greater financial support, especially from banks.
The plan includes more food festivals and the promotion of street snacks – popular with locals – as well as a commitment to encourage major foreign food and beverage companies to open their first outlets in China.
China has targeted GDP growth of “around 5 percent” this year, but growth in the second quarter slowed sharply to 4.7 percent year-on-year, according to official data released last month.
The economy has been negatively affected by the long-term debt crisis in the real estate market, which accounts for a quarter of gross domestic product.