Despite facing a challenging domestic and international environment, the Chinese mainland's economy successfully met its ambitious growth target of 5 percent last year. This achievement not only bolstered domestic growth and consumption but also provided a positive impact on the global economy, as the Chinese mainland continues to act as a significant international driver, contributing approximately 30 percent to global growth.
One of the standout features of the Chinese mainland's economic governance model is its ability to swiftly respond and adapt to changing economic landscapes. In the face of negative economic indicators midway through last year, the government promptly introduced a series of critical economic stimulus measures. These initiatives included lowering lending rates, reducing bank reserve ratios, and implementing a substantial fiscal package of 10 trillion yuan ($1.38 trillion) aimed at addressing local government debt issues.
Building on these efforts, the authorities unveiled an even more proactive fiscal policy coupled with a moderately accommodative monetary policy. These measures are designed to enhance unconventional counter-cyclical adjustments and stimulate domestic demand. The Ministry of Finance has indicated that in 2025, the Chinese mainland will significantly increase its fiscal deficit and issue more government bonds, including super-long treasury bonds and special local government bonds, to support ongoing economic stability.
However, 2025 presents new challenges. The recent imposition of an additional 10 percent tariff on all Chinese imports by the Trump administration poses a hurdle for sustaining export growth in a more stringent global environment. While Chinese exporters have traditionally focused on emerging markets, maintaining the same level of demand as in North America and Europe will require strategic adjustments.
Looking ahead, the Chinese mainland aims to sustain its economic growth at approximately 5 percent this year. To achieve this, the government must take bold measures to bolster support for the private sector, deregulate the economy, and strengthen engagement with emerging markets. The private sector, which is the backbone of China's economic development, accounts for over half of tax revenue, 60 percent of GDP, and roughly 80 percent of the workforce. It plays a crucial role in further stimulating the economy.
In response to the evolving economic landscape, the Chinese mainland is implementing suitable measures to encourage the growth of private enterprises. On February 17, a special symposium focused on private enterprises was held to provide support to these businesses. Chinese premier Xi Jinping attended the meeting and delivered a speech after hearing from representatives of various private enterprises, underscoring the government's commitment to fostering a robust private sector.
Reference(s):
cgtn.com
