China’s economic situation is bleak. Experts believe that some of the goals set by the Communist Party will be difficult to achieve. The party’s powerful leadership circle now wants to tackle problems.
China’s leadership has called for further support for the struggling real estate market, sufficient tax spending and an improvement in sluggish consumption amid the tense economic situation. In addition, top Communist Party cadres stressed during a meeting chaired by President and Party leader Xi Jinping that economic targets for this year must be achieved, China’s official Xinhua news agency reported.
The Politburo, the inner leadership circle of the Communist Party, met. The report did not give exact figures or plans for implementing the demands. But the statements are likely to be significant, as the government admitted to economic problems. The party appears to be sticking to its self-imposed economic growth target of around five percent for this year, while experts have recently seen the target increasingly under threat.
Real estate, bonds, income
Specifically, according to the report, the party wants to improve its real estate portfolio and increase investment in construction projects desired by the government. China wants to use government bonds to “better play the role of state investment.” The party’s center of power also called for consumption to be boosted and for people in the middle and lower income classes to earn more.
The economic data of the world’s second largest economy has recently given experts cause for concern. China’s central bank announced during the week that it would lower interest rates for housing loans and reduce the rate for minimum cash reserves at banks. China wants to use this to free up more funds for the financial markets. The crisis in the real estate sector is further contributing to sluggish consumption among many consumers, who tend to hold on to their money rather than spend it.
Problem of unemployment
On top of that, many people are looking for work. In the age group between 16 and 24, the latest unemployment rate rose to 18.8 percent, according to official figures. The State Council, China’s government cabinet, called on Wednesday for more “high-quality jobs” and new jobs to be created in the digital economy. Better training should also combat structural unemployment. The report did not provide any precise details.
Source: Stern
