BEIJING: Against the backdrop of the COVID-19 pandemic and external complexities and uncertainties, China is maneuvering its policy toolkit to bolster the demand of its super-large domestic market to perk up the economy for stronger growth.
At a high-profile meeting last week, Chinese leadership analyzed the current economic situation, stressing that macro policies should play a proactive role in boosting demand. Fiscal and monetary policies should be able to effectively offset deficiency in social demand.
“Taking both immediate and long-term benefits into consideration, the policies emphasized efforts to expand domestic demand further, spur the vitality of market entities, and foster new growth drivers,” said Wang Yiming, deputy head of the China Center for International Economic Exchanges.
The meeting noted that the utilization of special local government bonds should be optimized and local governments should be encouraged to make adequate and good use of the special debt quota.
Special-purpose bonds play a vital role in catalyzing investment and promoting the construction of a modern infrastructure system, said Vice Minister of Finance Xu Hongcai.
In the first half of the year, local governments in China issued 3.41 trillion yuan (about 504.2 billion U.S. dollars) worth of new special bonds, which offered support to over 23,800 projects, official data showed.
It was also stressed at the meeting that the monetary policy should help maintain a proper and adequate liquidity supply, increase credit support for enterprises, and make good use of new loans from policy banks as well as their funding for infrastructure projects. –Agencies
