Photo Credit: Lintao Zhang/Getty Images
China's supreme leaders including the President, Mr Xi Jinping, vowed Thursday to resolve "risks" plaguing the economy, state media said, but were yet to offer any concrete steps to pull the country out of its financial woes.
The world's second-largest economy is grappling with a property debt crisis, weakening consumption, and an ageing population. All eyes were on how this week's Communist Party conference in Beijing, attended by President Xi Jinping, might tackle that deepening economic malaise. But few new policies were announced as the meeting wrapped up Thursday, with state news agency Xinhua saying they had instead "adopted a resolution on further deepening reform".
Gary Ng, a senior economist at Natixis, said the readout offered "nothing out of expectation as it just confirms existing policies." But officials did agree to "actively expand domestic demand", state media reported, after data this week showed retail sales -- a key gauge of consumption -- rose just two percent in June.
They further agreed to "prevent and resolve risks in key areas such as real estate, (and) local government debt", Xinhua said. The Third Plenum has previously been an occasion for the party's top leadership to unveil major economic policy shifts.
Echoing past plena, top officials promised Thursday to "give fuller play to the role of market mechanisms". But they also said they would "make up for market failures" and "smooth the circulation of the national economy".
The meeting comes just days after China posted official statistics showing the economy grew by just 4.7 percent in the second quarter of the year. It represented the slowest rate of expansion since early 2023, when China was emerging from a crippling zero-Covid policy that strangled growth. Analysts polled by Bloomberg had expected 5.1 percent.
Beijing has said it is aiming for five percent growth this year -- enviable for many Western countries but a far cry from the double-digit expansion that for years drove the Chinese economy.
The economic uncertainty is also fuelling a vicious cycle that has kept consumption stubbornly low.
Among the most urgent issues facing the economy is the beleaguered property sector, which long served as a key engine for growth but is now mired in debt, with several top firms facing liquidation. With the country facing those headwinds, this week's meeting resolved to "strengthen guidance of public opinion and effectively prevent and resolve ideological risks", according to state media.
Lewis Musonye
