JAKARTA (TheInsiderStories) – The State Council of China recently issued a policy package, rolling out 20 measures to step up consumption, in a bid to boost customer confidence and expedite the healthy development of a national economy.
China plans to provide more support for its economy, including investing in infrastructure projects and regional development, while maintaining a prudent monetary policy with “reasonably” ample liquidity, the State Council said on Sunday (09/2).
As the world’s second-largest economy weathers its biggest slowdown in decades, the State Council said the government aimed to better integrate fiscal, financial and monetary policies, deepen capital market reforms and further open up the financial sector.
“We attach great importance to the development of infrastructure, high-tech, traditional industrial transformation, social services, and new growth regions,” the State Council said in a statement following a meeting of the Financial Stability and Development Commission (FSDC) chaired by Vice Premier Liu He on Saturday.
China’s economy faces pressures from a bruising trade war with the United States (US). The two countries began imposing additional tariffs on each other’s goods on Sunday, the latest escalation in the trade dispute, despite signs that talks would resume sometime this month.
China’s vast manufacturing sector shrank in August for the fourth month in a row, data showed on Saturday, although the services sector picked up for the first time in five months.
The State Council said the government would also encourage banks to use more innovative tools to replenish capital through multiple channels, but did not elaborate.
In accordance with the policy package, emerging business types will develop with further help. Cutting-edge information technologies, highlighting big data, cloud computing, and mobile network, should be widely applied, with a new slew of platforms, business types, and business modes to mushroom.
Distribution firms seek innovation and upgrading. Offline business entities should introduce new business philosophies, technologies, and designs. Commercial pedestrian zones need to be further upgraded. Local governments can support reconstruction projects regarding the infrastructure, traffic facilities, information platforms, and credit systems. And premium and digitalized management services should forge ahead.
Smart convenience chain stores will pirouette and develop with household names and brands, with streamlining administration and delegating powers constantly deepened. Handy service facilities for residents will be further optimized, with Internet Plus Communities – public service platforms – to be established. And nongovernmental organizations are encouraged to provide social services.
Rural circulation systems should develop with high efficiency, with rural circulation facilities upgraded and e-commerce widely available. And Internet Plus agricultural products will enjoy bigger urban market shares with government support.
Exports will enjoy easier access to domestic markets. Products, either for exporting or importing, should be of the identical quality, conforming to the same standards.
Consumers’ demands for premium export products will be further satisfied. And bonded demonstration and transaction platforms are allowed to be established within special customs regulation zones. Consumption potential will be tapped, with restrictions on car purchases to be eased, in a bid to support auto sales.
Green smart commodities will enjoy trade-in services. Distribution enterprises, if qualified, are allowed to recycle obsolete electronic products. Night businesses and markets call for more vitality, with longer business hours permitted and late-night business zones allowed to operate.
Holiday consumption will enjoy a larger space, with normalized consumption venues and special consumption fairs to be established. Marketing platforms for products with branded products should be established, in a bid to help domestic brands gain popularity and facilitate industrial upgrading.
Distribution enterprises will see a reduction in their cost. Industrial and commercial power utilization will be priced the same. Distribution companies are encouraged to engage in research, development, and innovation. And advanced logistics equipment makers will develop with solid support.
Petroleum products will enjoy easier market access. Approval procedures for petroleum business qualifications will be annulled, and related regulation for petroleum products circulation will be strengthened.
Fiscal capitals will play a bigger role to navigate consumption expansion, which applies to financial support as well. Market circulation environment will be further optimized, with more efforts taken to consolidate the construction of consumption credit systems.
On the contrary, the 15 percent US duty hit consumer goods ranging from footwear and apparel to home textiles and certain technology products like the Apple Watch. A separate batch of about US$160 billion in Chinese goods – including laptops and cellphones – will be hit with 15 percent tariffs on Dec. 15. President Donald Trump delayed part of the levies to blunt the impact on holiday shopping.
Investors sought the safety of the yen as the currency markets opened for trading, with the Japanese exchange rate advancing 0.3 percent against the dollar. The New Zealand dollar slid 0.5 percent, the worst performance among the Group-of-10 currencies. The offshore yuan fell 0.15 percent to 7.1732 per dollar.
US and Japanese equity futures fell in early Asian trading as the tariffs kicked in, even though the measures had been widely anticipated. S&P 500 futures opened 1 percent lower before paring losses, and Treasury contracts advanced.
While the Trump administration has dismissed concern about a protracted trade war, business groups are calling for a tariff truce and the resumption of negotiations between the world’s two largest economies.
Face-to-face talks between Chinese and American trade negotiators scheduled for Washington in September are still on, Trump told reporters Sunday. The president repeated the assertion that China, not the US, is “paying” for the tariffs, and said that farmers hurt by Beijing’s retaliation on U.S. agricultural goods are being made “more than whole” by federal payments.
“We are talking to China, the meeting is still on. We can’t allow China to rip us off anymore,” Trump said.
Written by Marcel Gual, Email: email@example.com