China is undertaking a strategic balancing act to propel its economy to new heights by coordinating the expansion of domestic demand with deepening supply-side structural reforms. This dual approach aims to address current economic challenges and set the stage for sustainable growth.
Understanding the Evolution of Strategic Concepts
The strategy to expand domestic demand focuses on accelerating the recovery and growth of consumption, recognizing its foundational role in the economy. By stimulating consumer spending and emphasizing key investments, China aims to establish a robust domestic demand system.
Recognizing Changes in Supply and Demand Dynamics
On the demand side, China faces the task of revitalizing consumption and overcoming insufficient effective and high-quality demand. Simultaneously, the supply side grapples with overcapacity in low-end sectors and a shortage of high-end supply, along with risks to supply chain security. These intertwined challenges necessitate coordinated efforts to accurately identify and address the primary issues.
Striking a Balance in Macroeconomic Governance
Expanding domestic demand and supply-side structural reforms are complementary strategies rather than opposing forces. In China’s new development paradigm, expanding domestic demand serves as a strategic cornerstone, while deepening supply-side reforms remains the central task. By harmonizing these approaches, China seeks to upgrade supply through demand stimulation and unlock potential demand through supply improvements, achieving a dynamic equilibrium in the economy.
This coordinated strategy underscores China’s commitment to sustainable and balanced economic growth. Stakeholders worldwide are watching as China implements these policies to navigate the complexities of the global economic landscape.
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Coordinating demand expansion and supply-side structural reform
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