BEIJING, Dec. 13, 2024 -- The closely watched Central Economic Work Conference was held in Beijing from Wednesday to Thursday as Chinese leaders decided priorities for the economic work in 2025.
Xi Jinping, general secretary of the Communist Party of China Central Committee, Chinese president and chairman of the Central Military Commission, delivered an important speech at the annual conference.
According to the meeting, despite the "complex and severe situation of growing external pressures and increasing internal difficulties," China has ensured the overall stability and steady progress of the economy, and the major goals and tasks for economic and social development in 2024 are expected to be accomplished.
It stressed that China must adopt more proactive macro policies, expand domestic demand, and promote the integrated development of scientific and technological innovation and industrial innovation to do a good job in economic work in 2025.
Efforts must also be made to secure the steady development of the real estate and stock markets, guard against and defuse risks and external shocks in key areas, and stabilize expectations and stimulate vitality so as to promote sustained economic recovery, said the meeting.
From fiscal policy to monetary policy
According to the meeting, China will also adopt a "more proactive" fiscal policy, including an increase in the ratio of deficit and in the issuance of ultra-long special treasury bonds and local government special-purpose bonds.
China's government debt-to-GDP ratio, according to the Ministry of Finance, stood at 67.5 percent at the end of 2023, much lower than the average 118.2 percent among G20 members and 123.4 percent for G7 countries estimated by the International Monetary Fund (IMF). China's fiscal deficit has long been below 3 percent, significantly lower than other major economies.
With a low government leverage ratio, China's central budget has room for increased borrowing and deficit expansion, Minister of Finance Lan Fo'an said in October.
The Central Economic Work Conference said China will adopt a "moderately loose" monetary policy and lower the reserve requirement ratio and interest rates when necessary to ensure adequate liquidity.
It marks the first "prudent" to "moderately loose" transition in the country's monetary stance since 2011.
Since the beginning of 2024, the People's Bank of China, the central bank, has cut the reserve requirement ratio twice, by 1 percentage point in total, for financial institutions, releasing approximately 2 trillion yuan (about $274.8 billion) in long-term liquidity.
From domestic demand to opening up
The Central Economic Work Conference listed priorities for economic work in 2025 in nine aspects, from stimulating consumption and developing new quality productive forces to preventing and addressing risks in key areas, consolidating poverty alleviation achievements and boosting green development.
The meeting stressed the need to vigorously boost consumption, improve investment efficiency and expand domestic demand on all fronts.
China remains one of the largest markets in the world. From January to October this year, China's total retail sales of consumer goods approached 40 trillion yuan, while last year's total exceeded 47 trillion yuan, according to the National Bureau of Statistics.
A national program aimed at promoting consumer goods trade-ins, unveiled in March, has demonstrated the untapped room of China's domestic demand. Over 30 million participants have been attracted to the program, contributing total sales of over 400 billion yuan.
The two-day meeting also called for more efforts to further promote high-level opening up and secure the steady growth of foreign trade and foreign investment.
"China's development is open and inclusive," said Xi while meeting leaders of major international economic organizations, including the IMF, in Beijing on Tuesday, one day before the start of the annual conference.
China will put in place new systems for a higher-standard open economy, provide more opportunities for the development of other countries and share more development benefits with the world, Xi told the leaders at the Great Hall of the People.
Starting December 1, China has granted zero-tariff treatment for 100 percent of tariff lines to all least developed countries with which it has diplomatic relations.
That will help more products from these countries enter the Chinese market, sharing opportunities and boosting development, said Lyu Daliang, an official from China's General Administration of Customs.
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